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EX    LIBRIS 

THE    UNIVERSITY 

OF    CALIFORNIA 


FROM  THE  FUND 

ESTABLISHED  AT  YALE 

IN  1927  BY 

WILLIAM  H.  CROCKER 

OF  THE  CLASS  OF  1882 

SHEFFIELD  SCIENTIFIC  SCHOOL 

YALE  UNIVERSITY 


Digitized  by  the  Internet  Archive 

in  2007  with  funding  from 

IVIicrosoft  Corporation 


http://www.archive.org/details/corporationactofOObeacrich 


THE  CORPORATION  ACT  OF  CONNECTICUT 


THE  CORPORATION  ACT  OF 
CONNECTICUT 

AS  AMENDED  BY  THE  GENERAL  ASSEMBLY 
OF  1905,  1907,  1909  AND  1911 

WITH  NOTES  AND  FORMS 

Compiled  Through  Five  Editions 
By  John  S.  Beach 


Compiled  Through  Three  Editions 
By  Francis  G.  Beach 


By 
ELIOT  WATROUS 


New  Haven:  Yale  University  Press 
1912 


f1  /\^ 


Copyright,  1912, 

BY 

Yale  University  Press 


First  printed  November,  1000  copies 


PREFACE  TO  FIRST  EDITION. 

The  original  object  of  this  compilation  was  to  collate 
the  numerous  amendments  of  the  joint  stock  act, 
scattered  through  the  annual  Public  Acts.  The  revi- 
sion of  the  Statutes  having  accomplished  the  same 
result  in  a  better  and  more  condensed  form,  the  work 
was  abandoned.  It  has  been  resumed,  taking  the 
revision  for  the  text  of  the  law,  not  with  the  presump- 
tion that  the  notes  and  forms  will  be  of  value  to  the 
profession,  but  in  the  hope  that  they  may  aid  the 
officers  of  corporations  in  the  discharge  of  their  duties. 
The  attempt  to  ensure  this  end  has  involved  some 
minuteness  of  detail  in  directions,  and  repetition  of 
forms,  which  may  seem  unnecessary  to  those — but  it 
is  believed  to  those  only — not  familiar  with  the 
records  of  joint  stock  corporations  as  usually  kept. 

New  Haven,  January  1,  1866. 


646G32 


PREFACE  TO  EIGHTH  EDITION. 

The  revision  of  the  Statutes  referred  to  in  the 
Preface  to  the  first  edition  was  that  of  1866.  A 
second  edition  was  issued  under  the  same  revision. 
The  revision  of  1875  caused  a  third  edition.  The 
General  Assembly  of  1879  provided  for  the  appoint- 
ment of  a  commission  "To  Examine  and  Revise  the 
Joint  Stock  Laws. ' '  This  commission  reported  to  the 
General  Assembly  of  1880.  The  changes  made  by  this 
act  were  so  radical  as  to  call  for  an  edition  giving  the 
text  of  the  new  law,  with  corresponding  changes  of 
the  old  forms.  That  edition  having  been  exhausted, 
a  fifth  edition  was  presented,  giving  the  amendments 
of  the  Act  of  1880  up  to  and  including  the  session 
laws  of  1884.  The  revision  of  1888  necessitated  the 
sixth  edition.  Amendments  after  revision  of  1888  up 
to  1899  caused  a  seventh  edition. 

The  Corporation  Act  of  1901,  included  in  the  gen- 
eral statutes,  revision  of  1902,  differs  so  materially 
from  the  Joint  Stock  Act  that  an  eighth  edition  seems 
called  for.  The  provisions  of  the  Act  of  1901  are 
printed  in  italics,  each  section  being  followed  by 
extracts  from  the  General  Statutes  relating  to  the 
same  subject-matter,  and  these  are  followed  by  notes 
from  decisions  of  the  Supreme  Court  of  this  State  and 
of  the  United  States. 

New  Haven,  August,  1902. 


PREFACE  TO  NINTH  EDITION. 

In  the  ten  years  that  have  elapsed  since  the  last 
edition  of  this  book  appeared,  the  Corporation  Laws 
which  were  then  in  force  have  been  largely  superseded 
by  an  act  passed  by  the  General  Assembly  of  1903, 
generally  known  at  the  present  time  as  the  Corpora- 
tion Act.  This  Act  has  itself  been  the  subject  of  con- 
siderable amendment  by  the  last  four  sessions  of  the 
General  Assembly  and  a  number  of  important  and 
interesting  decisions  affecting  corporations  generally 
have  been  rendered  by  our  Supreme  Court  since  1902. 
It  has  seemed,  therefore,  in  view  of  these  facts,  that 
another  edition  of  this  book,  which  should  include 
these  amendments  and  decisions  and  forms  revised  to 
conform  to  the  Act  as  amended,  would  be  of  practical 
value  not  only  to  the  members  of  the  Bar,  but  to 
all  persons  having  anything  to  do  with  the  prac- 
tical management  of  the  present-day  corporation  of 
Connecticut. 

As  will  be  seen,  the  notes  of  cases  in  the  present 
edition  follow  the  particular  section  of  the  Corpora- 
tion Act  to  which  they  refer.  The  provisions  of  the 
General  Statutes  and  Public  Acts  are  in  italics 
throughout  and  the  notes  of  cases  are  distinguishable 
from  the  rest  of  the  text  by  being  in  small  tj^pe. 

It  is  a  pleasure  to  acknowledge  the  efficient  and 
painstaking  services  and  practical  suggestions  of 
Thomas  M.  Steele,  Esq.,  of  the  New  Haven  County 
Bar,  which  were  of  material  assistance  in  the 
compilation  of  this  book. 

Eliot  Watrous. 

New  Haven,  August  1,  1912. 


INDEX  TO  CASES  CITED. 

PAGE 

Allen  vs.  Curtis,  26  Conn.  456 29 

American  Asylum  vs.  Phoenix  Bank,  4  Conn.  172 91 

Ashley  vs.  Ryan,  153  U.  S.  436 124 

Baldwin,  Trustee,  vs.  Wolff,  82  Conn.  559 30,  108 

Barber  vs.  Morgan,  84  Conn.  618 14 

Barr  vs.  Bartram  &  Fanton  Mfg.  Co.  et  al.,  41  Conn.  506 . .     16 

Barrows  vs.  Natchaug  Silk  Co.,  72  Conn.  658 39 

Bartholomew  et  al.  vs.  Derby  Rubber  Co.,  69  Conn.  521.  ...     16 

Bassett  et  al.  vs.  Atwater,  Pres.,  et  al.,  65  Conn.  355 91 

Beckwith  vs.  Windsor  Mfg.  Co.,  14  Conn.  594 15 

Bedford  vs.  Eastern  Bldg.  &  Loan  Ass'n,  181  U.  S.  227. .   124 

Beers  vs.  Bridgeport  Spring  Co.,  42  Conn.  17 21,  27 

Belfast  Mesh  Underwear  Co.,  in  re,  153  Fed.  224 64 

Bernheimer  vs.  Converse,  206  U.  S.  516 41 

Bethany  vs.  Sperry,  10  Conn.  200 48 

Bishop  vs.  Bishop,  81  Conn.  509 20 

Boardman  et  al.  vs.  Mansfield  et  al..  Executors,  79  Conn. 

634    20,  94 

Boardman  et  al.,  Trustees,  vs.  Boardman  et  als.,  78  Conn. 

451  20 

Briggs  vs.  Spaulding,  141  U.  S.  132 30 

Bridgeport  Bank  vs.  N.  Y.  &  N.  H.  R.  R.  Co.,  30  Conn.  231,  139 

Brinley  et  al.,  Trustees,  vs.  Grou  et  al.,  50  Conn.  66 94 

Bulkeley 's  Appeal,  77  Conn.  45 88 

Bulkeley  vs.  Worthington  Ecclesiastical  Society,  78  Conn. 

526     20 

Bunnell,  Trustee,  vs.  Bronson,  Trustee,  78  Conn.  679 70 

Bush,  Trustee,  vs.  Ross,  68  Conn.  29 22 

Butler,  Rec'r,  vs.  Beach,  82  Conn.  417 32,  64,  109 

Butler  vs.  Cornwall  Iron  Co.,  22  Conn.  335 29 

Byrne  vs.  Schuyler  Electric  Mfg.  Co.  et  al.,  65  Conn.  336, 

15,  89 

Canfield,  Trustee,  vs.  Gregory,  66  Conn.  9 114 

Central  Nat  '1  Bank  vs.  Stoddard,  83  Conn.  332 48 

Central  Trust  Co.  vs.  McGeorge,  151  U.  S.  129 6 


xii  Index  to  Cases  Cited 

PAGE 

Chase  et  al.,  Trustees,  vs.  Tuttle  et  als.,  55  Conn.  455 28,  48 

Chemical  Nat'l  Bank  vs.  Hartford  Deposit  Co.,  161  U.  S.  1,  5 
Cogswell  vs.  Second  Nat'l  Bank,  76  Conn.  252,  S.  C.  78 

Conn.   75    21,  103 

Colt  vs.  Ives  et  als.,  31  Conn.  25 47 

Conn.  Breweries  Co.  vs.  Murphy,  81  Conn.  145 3 

Converse,   Eeceiver,   vs.   First   Nat'l  Bk.   of   Suffield,   212 

U.  S.  567 41 

Converse,  Receiver,  vs.  ^tna  Nat'l  Bank,  79  Conn.  163, 

40,  125 

Cooper  Mfg.  Co.  vs.  Ferguson  et  al.,  113  U.  S.  727 124 

Couch  vs.  City  Fire  Ins.  Co.  of  Hartford,  38  Conn.  181 17 

Crandall  et  al.,  Receivers,  vs.  Lincoln  et  als.,  52  Conn.  73, 

22,  36 

Curtis,  Trustee,  vs.  Osborn  et  als.,  79  Conn.  555 21 

Dartmouth    College    Trustees    vs.    Woodward,    4    Wheat. 

(U.  S.)  518 89 

Daughters    of    Isabella   No.    1   et  al.   vs.    National   Order 

of  the  Daughters  of  Isabella  et  als.,  83  Conn.  679 ...  2 
Davenport,  Eeceiver,  vs.  Lines,  72  Conn.  118,  S.  C,  77  Conn. 

473    22,  30 

Dickerman  vs.  Northern  Trust  Co.,  176  U.  S.  181 138 

Dutton  vs.  Connecticut  Bank,  13  Conn.  493 47 

Eastern  Bank  vs.  Capron,  22  Conn.  639 38 

Ens  worth  et  als.  vs.  Nat'l  Life  Ass'n,  81  Conn.  592 65 

Evarts  vs.  Killingworth  Mfg.  Co.,  20  Conn.  447 5 

Fairfield  County  Turnpike   Co.  vs.   Thorp,   13   Conn.   173, 

28,  39,  139 

Farmers  &  Citizens'  Bank  vs.  Payne,  25  Conn.  444 139 

Farrel  Foundry  vs.  Dart  et  al.,  26  Conn.  376 139 

Farrell  vs.  Winchester  Ave.  E.  E.  Co.  et  als.,  61  Conn.  127,  17 
First  Nat'l  Bank  vs.   Hartford  Life  &  Annuity  Ins.  Co. 

et  als.,  45  Conn.  22 44 

Fish,  Eeceiver,  vs.  Smith,  73  Conn.  377 36,  37,  40 

Gibbons  vs.  Mahon,  136  U.  S.  549 20 

Glenn  vs.  Marbury,  145  U.  S.  499 40 


Index  to  Cases  Cited  xiii 

PAGE 

Glenn  vs.  Liggett,  135  U.  S.  533 74 

Gold  Bluff  M.  &  L.  Corp.  vs.  Whitlock  et  al.,  75  Conn.  669, 

27,  111 

Goldey  vs.  Morning  News,  156  U.  S.  518 6 

Goodman  vs.  White  et  al.,  26  Conn.  317 39 

Green,  Trustee,  vs.  Bissell  et  als.,  79  Conn.  547 21 

Guarantee  Trust  &  Safe  Deposit  Co.  vs.  P.,  R.  &  N.  E. 

E.  R.  Co.,  69  Conn.  709 64 

Handley  vs.  Stutz,  139  U.  S.  417 40 

Hart  vs.  Boston,  H.  &  E.  R.  R.  Co.,  40  Conn.  524 64 

Hartford  Bank  vs.  Hart,  3  Day  491 139 

Heminway  vs.  Heminway,  58  Conn.  443 29 

Hitchcock  vs.  Galveston,  96  U.  S.  341 17 

Hinckley  vs.  Gilman,  94  U.  S.  467 63 

Hodges  vs.  New  England  Screw  Co.,  53  Am.  Dec.  642. ...  30 
Holmes,  Booth  &  Haydens  vs.  The  Holmes,  Booth  &  Atwood 

Mfg.  Co.,  37  Conn.  278 2 

Howe  et  als.  vs.  Keeler,  27  Conn.  538 15 

Hygeia  Distilled  Water  Co.  vs.  The  Hygeia  Ice  Co.,  70 

Conn.  516 :   72  Conn.  646 2 

Jacobs  vs.  Williams  et  al.,  85  Conn.  215 140 

Johnston,  Trustee,  vs.  Allis,  71  Conn.  207 37 

Kellogg  et  al.  vs.  Union  Co.,  12  Conn.  7 5 

Lahiff  vs.  St.  Joseph's  Total  Abstinence  and  Benevolent 

Society,  76  Conn.  648 91 

Lamkin  vs.  Baldwin  &  Lamkin  Co.,  72  Conn.  57 115 

Lane  vs.  Brainerd,  30  Conn.  565 28 

Lewisohn  et  al.  vs.  Stoddard  et  als.,  78  Conn.  575 

38,  40,  124,  129 

Litchfield  Bank  vs.  Peck,  29  Conn.  384 39 

Litchfield  Bank  vs.  Church,  29  Conn.  137 39 

Lothrop  et  al.  vs.  Stedman,  42  Conn.  583 89 

Lyon  et  als.  vs.  Rice  et  als.,  41  Conn.  245 91 

Mackay  et  als.  vs.  N.  Y.,  N.  H.  &  H.  R.  R.  Co.  et  als.,  82 

Conn.    73 4,  107 

Mallory  vs.  Mallory  Wheeler  Co.,  61  Conn.  131 29 


xiv  Index  to  Cases  Cited 

PAGE 

Mann  vs.  Cooke,  20  Conn.  178 37 

Marlborough  Mfg.  Co.  vs.  Smith,  2  Conn.  579 46 

Martin  vs.  Webb,  110  U.  S.  7 30 

McCall  vs.  Byram  Mfg.  Co.,  6  Conn.  427 51 

Middletown  Ferry  Co.  vs.  Town  of  Middletown,  40  Conn.  65,  3 

Mitchell  et  als.  vs.  Hotchkiss,  48  Conn.  9 90 

Morse,  Adm'r,  vs.  Consol.  Ry.  Co.,  81  Conn.  395 140 

MuUer  vs.  Dows,  94  U.  S.  444 3 

New  Haven  Trust  Co.,  Rec'r,  vs.  Doherty  et  al.,  75  Conn. 

555    28,  30 

New  Haven  Trust  Co.,  Eec'r,  vs.  Gaffney,  73  Conn.  480.  .  37 

New  Haven  Trust  Co.,  Eec'r,  vs.  Nelson,  73  Conn.  477 38 

New  Haven  &  Derby  R.  E.  Co.  vs.  Chapman,  38  Conn.  56, 

38,  111 

New  Haven  Wire  Co.  Cases,  57  Conn.  352 114 

New  Orleans  Debenture,  etc.,  Co.,  vs.  Louisiana,  180  U.  S. 

320     114 

Newtown  Savings  Bank  vs.  Lawrence  et  al.,  71  Conn.  358 .  .  70 

N.  Y.,  B.  &  E.  Ey.  Co.  vs.  Motil,  81  Conn.  466.  ..  .5,  6,  51,  115 

New  York  Firemen  Ins.  Co.  vs.  Ely  &  Parsons,  5  Conn.  560,  15 
New  York  &  New  Haven  E.  E.  Co.  vs.  Ketchum,  27  Conn. 

170  31 

New  York  Commercial  Company  vs.  Francis  et  al.,  83  Fed. 

769   47 

N.  Y.,  N.  H.  &  H.  E.  E.  Co.  vs.  Offield,  77  Conn.  417 103 

N.  Y.,  N.  H.  &  H.  E.  E.  Co.  vs.  Offield,  203  U.  S.  372 103 

New  York,  Hous.  &  N.  E.  E.  Co.  vs.  Hunt,  39  Conn.  75 114 

New  York  Life  Ins.  Co.  vs.  Cravens,  178  U.  S.  389 124 

Northrop,  Trustee,  vs.  Bushnell,  38  Conn.  498 39 

Northrop  vs.  Curtis  et  als.,  5  Conn.  246 46 

Northrop  vs.  Newtown  &  Bridgeport  Turnpike  Co.,  3  Conn. 

544  46 

Occum  Co.  vs.  Sprague  Mfg.  Co.,  34  Conn.  529 16 

Oregon  Ey.  &  Navigation  Co.  vs.  Oregonian  Ey.   Co.,  130 

U.  S.  1 16,  69 

Orient  Ins.  Co.  vs.  Daggs,  172  U.  S.  557 124 

Oxford  Turnpike  Co.  vs.  Bunnell,  6  Conn.  552 46 

Parsons  vs.  Utica  Cement  Mfg.  Co.,  82  Conn.  333 74 


Index  to  Cases  Cited  xv 

PAGE 

Paul  vs.  Virginia,  8  Wall.  (U.  S.)  168 ! . . . .   124 

Pearce  vs.  Olney,  20  Conn.  544 5 

Pearsall  vs.  Great  Northern  Ey.  Co.,  161  U.  S.  646 89 

Peck  vs.  Booth  et  als.,  42  Conn.  271 91 

Pembina  Con.  Silver  Mining  &  Milling  Co.  vs.  Pennsylvania, 

125  U.   S.   181 3,  124 

Perkins  et  als.  vs.  Coffin  et  als.,  84  Conn.  275 37,  49,  90 

Piatt  vs.  Birmingham  Axle  Co.  et  als.,  41  Conn.  255 44 

Pope  et  al..  Receivers,  vs.  Town  &  City  of  Hartford,  82 

Conn.    406 86,  87 

Pratt  et  al.  vs.  Pratt,  Read  &  Co.,  33  Conn.  446 27,  29 

Premier  Cycle  Co.,  in  re,  70  Conn.  473 63 

Ray  vs.  Robert  Price  Coal  Co.  et  als.,  80  Conn.  558 64 

Reed  vs.  Copeland,  50  Conn.  472 46 

Russell,  Receiver,  vs.  Easterbrook,  71  Conn.  50 39,  46 

Savings  Bank  of  New  Haven  vs.  Davis  &  Center  et  als., 

8  Conn.  191  14,  28 

Scholfield  Gear  &  Pulley  Co.  vs.  Scholfield,  71  Conn.  1 138 

Sears  vs.  Hotchkiss  et  als.,  25  Conn.  171 29 

Second  Universalist  Church  of  Stamford  et   al.  vs.   Cole- 
grove,  74  Conn.  79 20 

Shelton  vs.  Healy,  74  Conn.  265 41 

Shepaug  Voting  Trust  Cases,  60  Conn.  553 52 

Shipman,  Trustee,  vs.  ^tna  Ins,  Co.  et  als.,  29  Conn.  245, 

44,  45 
Simonds  et   al.  vs.   East  Windsor  El.   Ry.   Co.   et  al.,   73 

Conn.  513 ". 35 

Smith,  Trustee,  vs.  Gaylord  et  als.,  47  Conn.  380 32 

Smith,  Trustee,  vs.  Dana  et  al.,  77  Conn.  543 20,  27,  94 

Smith  vs.  New  Hartford  Water  Co.,  73  Conn.  626 138 

Smith  vs.  Board  of  Water  Commissioners,  38  Conn.  208 .  . .   139 

S.  O.  &  C.  Co.  vs.  Ansonia  Water  Co.,  83  Conn.  611 5 

Southern  Pacific  Co.  vs.  Denton,  146  U.  S.  202 6,  124 

Spencer  vs.  Champion,  9  Conn.  536 5,  51 

Spooner  vs.  Phillips  et  al.,  62  Conn.  62 20,  21 

Stafford  Springs   St.  Ry.   Co.  vs.   Middle  River  Mfg.   Co. 

et  al.,   80  Conn.   37 28 


xvi  Index  to  Cases  Cited 

PAGE 

Stafford  ISiat.  Bank  vs.  Palmer  et  als.,  47  Conn.  443 114 

Stamford  Trust  Co.,  Trustee,  vs.  Yale  &  Towne  Mfg.  Co. 

et  als.,  83  Conn.  43 20,  34,  42,  49,  93,  115 

Stanton  et  al.  vs.  N.  Y.  &  E.  Ey.  Co.  et  als.,  59  Conn.  272. .  114 
Starr   Burying   Ground  Ass'n.   vs.   North  Lane   Cemetery 

Ass'n.,  77  Conn.  83 140 

State  ex  rel.  White  et  al.  vs.  Ferris  et  als.,  42  Conn.  560 . .     46 

State  vs.  Spittler  et  als.,  79  Conn.  470 59 

State  vs.  Hartford  &  N.  H.  R.  R.  Co.,  29  Conn.  538 90 

State  ex  rel.  Howard  vs.  Hartford  St.  By.  Co.,  76  Conn. 

174     91 

State  vs.   Towers,  71  Conn.  657 91 

Stoddard  vs.  Shetucket  Foundry  Co.,  34  Conn.  542 21 

Sullivan  County  R.  R.  Co.  vs.  Conn.  River,  etc.,  Co.  et  al., 

76  Conn.  464 121 

Terry  vs.  Eagle  Lock  Co.  et  als.,  47  Conn.  141 20 

Tobey  vs.  Hakes,  54  Conn.  274 91 

Toll  Bridge  Co.  vs.  Betsworth,  30  Conn.  380 139 

Town  of  Preston  vs.  Norwich  Compressed  Air  Power  Co., 

83  Conn.  561 3 

Town  of  Southington  vs.  Southington  Water  Co.,  80  Conn. 

646  89 

Union  &  New  Haven  Trust  Co.  vs.  Taintor  et  al.,  85  Conn., 

83   Atl.   697 22 

United  States  vs.  Northwestern  Express  Co.,  164  U.  S.  686,       6 

Vansands  vs.  Middlesex  County  Bank,  26  Conn.  144 47 

Ward  et  als.  vs.  Griswoldville  Mfg.  Co.,  16  Conn.  593 37 

Ward  et  al.  vs.  Connecticut  Pipe  Mfg.  Co.,  71  Conn.  345 .. .  64 

Webster  &  Co.  vs.  Howe  Machine  Co.,  54  Conn.  394 17 

Wilson,  Trustee,  vs.  Griswold,  79  Conn.  18 70 

Winsted  Hosiery  Co.  vs.  New  Britain  Knitting  Co.,  69  Conn. 

565     16 

Wood  et  als.  vs.  Wiley  Construction  Co.,  56  Conn.  87 114 

Woronieki  vs.  Pariskiego,  74  Conn.  224 2 

Yale  Gas  Stove  Co.  vs.  Wilcox,  64  Conn.  101 115,  137 


THE  CORPORATION  ACT  OF  CONNECTICUT 


THE   CORPORATION   ACT   OF 
CONNECTICUT. 


PART  I. 

Genekal  Provisions. 

Section  1.  Application.  The  provisions  of  this 
part  shall  apply  to  all  corporations  heretofore 
and  hereafter  organized  under  any  general  or 
special  law  of  this  state,  except  when  otherwise 
expressly  stated,  but  shall  not  be  held  or  con- 
strued to  alter  or  affect  any  provision  of  any 
special  charter  inconsistent  herewith,  except  as 
provided  in  section  37  of  this  act. 

NOTE. 

Section  37  provides  for  annual  reports  by  every 
company  having  capital  stock  with  certain  specified 
exceptions. 

Sec.  2.  Name  and  Location.  The  name  of 
every  corporation  hereafter  formed  shall  be 
such  as  to  distinguish  it  from  any  other  cor- 
poration organized  under  the  laws  of  this  state 
and  from  any  other  corporation  as  amended 
engaged  in  the   same  business  or  „  J""®  ^^e.  1907 

®     ®     ^  Public  Acts  1907, 

promoting  or  carrying  out  the  same       ch.  155. 
purposes  in  this  state,  and  every  such  name 
shall  be  in  the  English  Language  and  shall 
begin  with  ^^The''  and  end  with  *^ Company'^  or 


:3  .;  :';  ■'«".•.•  T.he  Corporation  Act 

** Corporation*^  or  have  the  word  '^Incorpo- 
rated'' immediately  after  or  under  the  name. 
Every  corporation  shall  be  located  in  some  town 
in  this  state. 

NOTES. 

Name.  The  law  will  protect  a  corporation  in  the 
use  of  its  name,  upon  the  same  principle  and  to  the 
same  extent  that  individuals  are  protected  in  the  use 
of  trade-marks.  Holmes,  Booth  &  Haydens  vs.  The 
Holmes,  Booth  &  Atwood  Mfg.  Co.,  37  Conn.  278  at 
293.  See  also  Hygeia  Distilled  Water  Co.  vs.  The 
Hygeia  Ice  Co.,  70  Conn.  516,  72  Conn.  646. 

A  corporation  which  attempts  to  appropriate  and 
use  the  distinctive  words  in  the  name  of  a  previously 
created  and  existing  corporation,  to  the  confusion  of 
the  latter 's  business  and  its  pecuniary  injury,  as  well 
as  to  the  deception  of  the  public,  may  properly  be 
restrained  from  such  use  by  injunction,  notwith- 
standing the  two  names  are  not  in  all  respects  iden- 
tical. The  Daughters  of  Isabella  No.  1  et  al.  vs.  The 
National  Order  of  the  Daughters  of  Isabella  et  als., 
83  Conn.  679. 

Name  indicating  that  corporation  is  a  bank,  trust 
company,  etc.,  prohibited,  except  under  certain  cir- 
cumstances.    See  Public  Acts  of  1911,  Chap.  197. 

As  to  conduct  of  business  under  Fictitious  Trade 
Names,  see  Public  Acts  of  1911,  Chap.  277. 

A  corporation  may  be  variously  described  in  the 
same  instrument  if  from  the  whole  it  appears  that 
one  and  the  same  corporation  is  meant.  Therefore, 
the  translation  of  the  proper  corporate  name,  pre- 
viously used  in  the  instrument,  into  a  foreign  tongue 
in  the  signature,  is  immaterial.  "Woronieki  vs. 
Pariskiego,  74  Conn.  224. 

How  location  may  be  changed,  §§  73,  74,  infra,  pages 
116,  117. 


OF  Connecticut  3 

Limitation  on  power  to  change  location,  §  46,  infra, 
page  92. 

Location  of  corporate  property  for  purposes  of  taxa- 
tion, see  Gen.  St.  §§  2342,  Public  Acts  1907,  Chap.  74, 
§  5,  184;  Public  Acts  1911,  Chap.  201,  279,  and  see 
Town  of  Preston  vs.  Norwich  Compressed  Air  Power 
Co.,  83  Conn.  561.     (See  also  page  86,  infra.) 

The  principal  place  of  business  of  a  corporation  is 
the  place  where  its  governing  power  is  exercised  and 
not  where  the  labor  is  performed  in  carrying  out  the 
business  it  is  engaged  in.  Middletown  Ferry  Co.  vs. 
Town  of  Middletown,  40  Conn.  65. 

For  purposes  of  jurisdiction  of  the  Federal  courts 
a  corporation  is  treated  as  a  *' citizen"  of  that  state 
in  which  it  is  incorporated,  the  historical  theory 
being  that  a  suit  to  which  it  is  a  party  is  a  suit  by  or 
against  its  stockholders  who  are  conclusively  pre- 
sumed to  be  citizens  of  the  state  incorporating  them. 
See  Muller  vs.  Dows,  94  U.  S.  444. 

A  corporation  is  a  ''person"  within  the  meaning 
of  §  1  of  the  Fourteenth  Amendment  to  the  U.  S.  Con- 
stitution, providing  that  "no  State  shall  deny  to  any 
person  within  its  jurisdiction  the  equal  protection  of 
the  laws";  but  is  not  a  ''citizen"  within  Article  IV, 
§  II,  Clause  1,  providing  that  "the  citizens  of  each 
State  shall  be  entitled  to  all  privileges  and  immunities 
in  the  several  States."  Pembina  Consol.  Silver  Min- 
ing &  Milling  Co.  vs.  Pennsylvania,  125  U.  S.  181. 

' '  The  words  '  person '  and  '  another '  may  extend  and 
be  applied  to  communities,  companies,  corporations, 
public  or  private,  societies  and  associations."  Gen. 
St.  1902,  §  1.  So  a  corporation  may  be  granted  a 
license  to  sell  liquor  under  Gen.  St.  §  2643  empower- 
ing the  county  commissioners  to  license  "suitable 
persons. ' '  Conn.  Breweries  Co.  vs.  Murphy,  81  Conn. 
145. 

A  private  corporation  may  be  defined  as  an  asso- 
ciation of  persons  to  whom  the  sovereign  has  offered 
a  franchise  to  become  an  artificial,  juridical  person, 


4  The  Cokporation  Act 

with  a  name  of  its  own,  under  which  they  can  act  and 
contract,  and  sue  and  be  sued;  and  who  have  either 
accepted  the  offer  (in  which  case  a  corporation  de 
jure  has  been  constituted),  or  have  done  acts  indi- 
cating a  purpose  to  accept  such  offer  and  effected  an 
organization  designed  to  be,  but  in  fact  not,  in  sub- 
stantial conformity  with  its  terms  (in  which  case  a 
corporation  de  facto  has  been  constituted).  Mackay 
et  als.  vs.  The  N.  Y.,  N.  H.  &  H.  E.  Co.  et  als.,  82 
Conn.  73. 


Sec.  3.  General  Powers.  Every  corporation 
shall  have  power,  subject  to  such  provisions  and 
limitations  as  may  be  contained  in  its  charter, 
certificate  of  incorporation,  articles  of  associa- 
tion, or  in  any  statute  affecting  it :  (1)  To  have 
succession  by  its  corporate  name  for  the  time 
stated  in  its  charter,  certificate  of  incorpora- 
tion, or  articles  of  association,  and,  when  no 
period  is  limited,  perpetually:  (2)  To  sue  and 
be  sued  and  complain  and  defend  in  any  court : 
(3)  To  make  and  use  a  common  seal  and  alter 
the  same  at  pleasure:  (4)  To  hold,  purchase, 
sell,  and  convey  such  real  and  personal  estate 
as  the  purposes  of  such  corporation  shall 
require,  and  all  other  property  which  shall  have 
been  in  good  faith  mortgaged  or  conveyed  to  it 
by  way  of  security  or  in  satisfaction  of  debts 
or  by  purchase  at  sales  upon  judgments  or 
decrees  obtained  for  such  debts:  (5)  To  elect 
or  appoint,  in  such  manner  as  it  may  determine, 
all  necessary  or  proper  officers  and  agents  and 
to    ^x    their    compensation    and    define    their 


OF  Connecticut  5 

powers  and  duties :  (6)  To  make  by-laws,  con- 
sistent with  law,  fixing  the  number  of  its  direct- 
ors and  for  its  government,  the  regulation  of 
its  affairs,  and  the  management  of  its  prop- 
erty: (7)  To  wind  up  and  dissolve  itself,  or  to 
be  wound  up  and  dissolved,  in  the  manner 
provided  by  law. 

NOTES. 

A  corporation  may  exercise  all  powers,  within  the 
fair  intent  and  purpose  of  its  creation,  which  are 
reasonably  proper  to  give  effect  to  powers  expressly 
granted ;  and  in  doing  this,  the  corporation  must  have 
a  choice  of  the  means  adapted  to  ends,  and  is  not  to 
be  confined  to  any  one  mode  of  operation.  S.  0.  &  C. 
Co.  vs.  Ansonia  Water  Co.,  83  Conn.  611. 

Duration.  A  corporation  is  not  dissolved  ipso  facto 
by  its  neglect  to  exercise  its  corporate  franchises, 
Spencer  vs.  Champion,  9  Conn.  536  (but  see  §  24, 
infra)  ;  nor  by  such  neglect  coupled  with  the  resigna- 
tion of  its  officers,  Evarts  vs.  The  Killingworth  Mfg. 
Co.,  20  Conn.  447 ;  nor  by  its  insolvency  and  the  sub- 
sequent appointment  of  a  receiver.  Chemical  Bank 
vs.  Hartford  Deposit  Co.,  161  U.  S.  1,  4. 

Although  the  neglect  of  a  corporation  to  comply 
with  its  charter  requirements  may  be  sufficient  to 
produce  a  forfeiture  of  its  corporate  rights,  such  for- 
feiture must  first  be  judicially  determined  in  a  direct 
proceeding  on  the  part  of  the  public,  and  cannot  be 
taken  advantage  of  in  a  collateral  manner.  Kellogg 
et  al.  vs.  Union  Co.,  12  Conn.  7 ;  Pearce  vs.  Olney,  20 
Conn.  544 ;  New  York,  B.  &  E.  Ry.  Co.  vs.  Motil,  81 
Conn.  466  at  473. 

Where  the  law  under  which  a  railroad  company 
was  organized  provided  that  if  it  did  not  finish  its 
road  within  five   years  its  corporate   existence   and 


6  The  Cokpoeation  Act 

powers  should  cease,  the  extinction  of  its  right  to 
build  was  held  not  to  destroy,  ipso  facto,  its  corporate 
existence,  nor  extinguish  its  general  right  to  land 
which  it  had  acquired.  N.  Y.,  B.  &  E.  Ry.  Co.  vs. 
Motil,  81  Conn.  466. 

Jurisdiction.  Though  for  the  purpose  of  suing 
and  being  sued  in  the  Federal  courts  a  corporation  is 
treated  as  a  '^citizen"  of  the  state  which  incorporates 
it,  and  for  some  purposes  as  a  citizen  of  the  United 
States,  United  States  vs.  Northwestern  Express  Co., 
164  U.  S.  686;  the  privilege  of  exemption  from  suit 
outside  the  district  of  domicil  may  be  waived  by 
pleading  to  the  merits  in  a  suit  brought  against  it 
outside.  Central  Trust  Co.  vs.  McGeorge,  151  U.  S. 
129.  But  a  corporation  sued  in  a  personal  action  in 
a  court  of  a  state  where  it  neither  does  business  nor 
is  incorporated  does  not  waive  the  right  to  object  to 
the  jurisdiction  of  the  state  court  for  want  of  suffi- 
cient service  of  the  summons  by  appearing  specially 
to  petition  for  the  removal  of  the  action  into  a  Fed- 
eral court,  Goldey  vs.  Morning  News,  156  U.  S.  518; 
and  a  foreign  corporation  cannot  be  deprived  of  the 
right  of  removal  to  the  Federal  courts  by  a  state 
statute  requiring  it  to  agree  to  submit  to  process  in 
the  state  courts  as  a  condition  of  doing  an  interstate 
business  in  that  state.  So.  Pac.  Co,  vs.  Denton,  146 
U.  S.  202. 

Service  of  Process  on  a  corporation  is  provided  for 
by  Gen.  St.,  Rev.  of  1902,  §§  571,  572,  as  follows: 

§  571.     Process  how  served :  service  on  corporations. 

Except  as  otherwise  provided,  process  in  civil  actions 
shall  he  served  hy  leaving  a  true  and  attested  copy  of 
it,  including  the  declaration  or  complaint,  with  the 
defendant,  or  at  his  usual  place  of  abode,  in  this  state. 
Process  in  civil  actions  against  the  following  described 
classes  of  defendants  shall  be  served  as  follows:  in 
actions  against  a  county,  upon  one  of  the  county 


OF  Connecticut  7 

commissioners;  against  a  town,  upon  its  clerk  or  one 
of  its  selectmen;  against  a  city,  upon  its  clerk,  assist- 
ant clerk,  or  upon  its  mayor;  against  a  borough,  upon 
its  clerk,  or  upon  the  warden  or  one  of  its  burgesses; 
against  a  school  district,  upon  its  clerk  or  one  of  its 
committee;  against  other  municipal  or  quasi-munici- 
pal corporations,  upon  its  clerk,  or  upon  its  chief 
presiding  officer  or  managing  agent.  In  actions 
against  private  corporations,  service  shall  be  made 
either  upon  the  president,  the  vice-president,  the 
secretary,  the  assistant  secretary,  the  treasurer,  the 
assistant  treasurer,  the  cashier,  the  assistant  cashier, 
the  teller,  the  assistant  teller,  or  its  general  or  man- 
aging agent,  or  upon  any  director  resident  in  this 
state.  In  case  none  of  such  officers  or  directors  can 
be  found,  service  may  be  made  upon  the  person  in 
charge  of  the  business  of  the  corporation,  or  upon 
any  person  who  is,  at  the  time  of  service,  in  charge  of 
the  office  of  the  corporation  in  the  town  in  which  its 
principal  office  or  place  of  business  is  located.  In 
actions  against  private  corporations  established  under 
the  laws  of  the  United  States  or  of  any  other  state  or 
foreign  country,  service  may  be  made  upon  any  of 
the  aforesaid  officers  or  agents,  or  upon  the  resident 
attorney  of  such  corporation  appointed  pursuant  to 
§  83  (of  this  act). 

§  572.  Service  of  process  by  advertisement  or  other- 
wise. If  any  corporation  organized  under  the  laws 
of  this  state  shall  have  no  officer  or  agent  upon  whom 
process  against  it  can  be  served,  any  judge,  clerk,  or 
assistant  clerk,  of  the  superior  court,  court  of  common 
pleas,  or  the  district  court  of  Waterbury,  to  which 
any  action  against  said  corporation  is  brought,  may 
authorize  service  of  process  in  said  action  upon  said 
corporation  by  advertisement,  or  may  make  such  other 
or  further  order  concerning  such  service  of  process 
as  may  be  deemed  reasonable,  and  service  made  in 
accordance  with  such  order  shall  be  deemed  sufficient 
service  of  process  upon  said  corporation. 


8  The  Corporation  Act 

§  575-  Service  on  nonresident  in  cases  of  quo  war- 
ranto. An  information  in  the  nature  of  quo  war- 
ranto brought  against  a  nonresident  usurping  any 
office  in  a  corporation  organized  under  the  laws  of 
this  state,  may  he  served  upon  said  nonresident  by 
leaving  a  copy  with  the  secretary  of  said  corporation 
if  he  resides  in  this  state,  and,  if  not,  then  with  the 
treasurer  or  assistant  treasurer  of  said  corporation, 
and  in  case  no  such  officer  resides  within  this  state, 
then  service  thereof  may  be  made  upon  the  attorney- 
general  of  this  state;  and  any  such  service  shall  be 
service  upon  such  nonresident  defendant  and  shall  be 
sufficient  notice  to  the  defendant,  if  he  is  not  a  resi- 
dent of  this  state,  to  enable  the  relator  to  bring  said 
action  to  trial. 

Corporation  as  garnishee.  The  General  Statutes, 
Kevision  of  1902,  expressly  authorize  making  a  cor- 
poration a  garnishee,  and  provide  for  the  manner  in 
which  it  may  make  disclosure  and  the  effect  thereof. 
The  more  important  sections  are  as  follows : 

§  88o.  Process  of  foreign  attachment.  When  the 
effects  of  the  defendant  in  any  civil  action  in  which 
a  judgment  or  decree  for  the  payment  of  money  may 
be  rendered,  are  concealed  in  the  hands  of  his  agent 
or  trustee  so  that  they  cannot  be  found  or  attached, 
or  where  a  debt  is  due  from  any  person  to  such 
defendant,  or  where  any  debt,  legacy,  or  distributive 
share,  is  or  may  become  due  to  such  defendant  from 
the  estate  of  any  deceased  person  or  insolvent  debtor, 
the  plaintiff  may  insert  in  his  writ  a  direction  to  the 
officer  to  leave  a  true  and  attested  copy  thereof  and 
of  the  accompanying  complaint,  at  least  twelve  days 
before  the  session  of  the  court  to  which  it  is  return- 
able, with  such  agent,  trustee,  or  debtor  of  the  defend- 
ant, or,  as  the  case  ynay  be,  with  the  executor,  admin- 
istrator, or  trustee  of  such  estate,  or  at  the  usual 
place  of  abode  of  such  garnishee;  and  from  the  time 
of  leaving  such  copy,  all  the  effects  of  the  defendant 
in  the  hands  of  any  such  garnishee,  and  any  debt  due 


OF  Connecticut  9 

from  any  such  garnishee  to  the  defendant,  and  any 
debt,  legacy,  or  distributive  share,  due  or  that  may 
become  due  to  him  from  such  executor,  administrator, 
or  trustee  in  insolvency,  not  exempt  from  execution, 
shall  be  secured  in  the  hands  of  such  garnishee  to  pay 
such  judgment  as  the  plaintiff  may  recover. 

§  88i.  Citing  garnishee  to  disclose.  The  plaintiff 
may  insert  in  the  writ  a  direction  to  the  garnishee — 
except  he  be  described  as  an  executor,  administrator 
or  trustee  in  insolvency,  in  which  case  he  shall  not  be 
so  cited  in — to  appear  before  the  court  to  which  the 
process  is  returnable  and  there  disclose  on  oath 
whether  he  has  in  his  hands  the  goods  or  effects  of  the 
defendant,  or  is  indebted  to  him;  and  at  any  time 
during  the  pendency  of  a  foreign  attachment  suit  any 
garnishee  who  might  have  been  so  cited  in  but  was  not, 
may  be  cited  by  the  court  to  appear  before  it,  at  a 
time  appointed,  to  make  such  disclosure. 

§  882.  Disclosure  by  garnishee  to  oflBicer.  The  officer 
serving  process  upon  any  person  or  corporation 
named  as  garnishee  shall,  at  the  time  of  service,  make 
inquiry  as  to  the  amount  then  owed  by  said  garnishee 
to  the  defendant  in  said  action;  and  if  said  garnishee 
shall  thereupon  disclose  to  the  said  officer  whether 
anything  is  then  owed  to  said  defendant,  and  if  so, 
how  much,  said  officer  shall  then  and  there  indorse 
such  disclosure  on  said  process  as  a  part  of  his  return 
thereon;  and  such  disclosure  shall  excuse  said  gar- 
nishee from  appearing,  unless  thereafter  summoned 
as  a  witness,  before  the  court  to  which  said  process 
is  returnable,  and  said  court  may  without  further 
proof  find  the  fact  to  be  as  shown  by  such  disclosure. 

§883.  Corporation  as  garnishee;  disclosure;  non- 
appearance. If  any  corporation  made  a  garnishee 
and  cited  in  to  disclose,  was  not  indebted  to,  and  had 
no  effects  of,  the  defendant  in  its  possession  when  the 
complaint  was  served  upon  it,  it  need  not  appear 


10  The  Cokporation  Act 

before  the  court  to  disclose,  if  it  shall  cause  the  affi- 
davit of  its  treasurer  or  its  paymaster  stating  such 
fact  to  he  filed  in  said  court,  on  the  return  day  of  the 
complaint.  If  such  affidavit  shall  he  so  filed  and  the 
plaintiff  shall  hring  a  scire  facias  against  such  cor- 
poration upon  a  judgment  rendered  against  the  de- 
fendant in  the  complaint,  and  it  shall  he  found  on 
the  trial  that  the  corporation  was  not  indebted  to  the 
defendant  and  that  it  did  not  have  his  effects  in  its 
possession  at  the  time  of  the  service  of  the  complaint, 
judgment  shall  he  for  the  corporation  to  recover  its 
costs. 

§  884.     Liability  of  garnishee  for  not  appearing.    If 

any  garnishee,  cited  in  to  disclose  before  a  court  held 
in  a  town  other  than  that  in  which  he  resides,  was  not 
indebted  to  the  defendant,  and  had  no  effects  of  the 
defendant  in  his  possession  when  the  writ  was  served 
upon  him,  it  shall  he  a  sufficient  excuse  for  his  not 
appearing  before  said  court  if  he  file  therein  on  the 
return  day  of  the  writ  his  affidavit  stating  such  facts; 
hut  if  any  garnishee,  when  duly  cited  in  to  disclose, 
shall  fail  to  appear  without  reasonable  excuse,  or  shall 
refuse  to  disclose  on  oath  whether  he  has  any  effects 
of  the  defendant  in  his  possession,  or  is  indebted  to 
him,  then,  if  the  plaintiff  shall  hring  a  scire  facias 
against  him  on  a  judgment  recovered  against  the 
defendant  in  the  suit,  judgment  shall  he  rendered 
against  such  garnishee  personally  for  the  costs 
accrued  on  the  scire  facias,  though  it  shall  appear 
that  he  had  no  effects  of  the  debtor  in  his  possession 
and  was  not  indebted  to  him. 

§  885.  Disclosure  by  garnishee.  The  court  may 
examine  upon  oath  any  garnishee  cited  in  to  disclose 
as  to  whether,  at  the  time  of  the  service  of  the  foreign 
attachment,  he  had  effects  of  the  defendant  in  his 
hands,  or  was  indebted  to  him,  and  may  hear  any 
other  proper  evidence  respecting  the  same;  and  if  it 
appear  that  such  garnishee  had  not  effects  of  the  de- 


OF  Connecticut  11 

fendant  in  his  possession,  or  .was  not  indebted  to  him, 
he  shall  recover  judgment  for  his  costs;  hut  if  it 
appear  that  such  garnishee  had  in  his  possession 
effects  of  the  defendant,  or  was  indebted  to  him,  the 
court  shall  ascertain  the  amount,  and  the  same  shall, 
if  the  plaintiff  recovers  judgment  and  brings  a  scire 
facias  against  the  garnishee,  be  prima  facie  evidence 
of  the  facts  so  found;  but  the  defendant  shall  then 
have  a  right  again  to  disclose  on  oath,  and  the  parties 
may  introduce  any  other  proper  testimony  regarding 
such  facts.  If  the  plaintiff,  in  such  action  by  foreign 
attachment,  withdraws  his  suit,  or  fails  to  recover 
judgment  against  the  defendant,  such  garnishee  shall 
be  entitled  to  judgment  for  his  costs. 

§  886.  Service  of  garnishee  process  on  corporation. 
When  any  corporation  engaged  in  transacting  busi- 
ness in  any  other  town  than  that  in  which  its  secretary 
or  clerk  resides,  shall  be  named  as  agent,  trustee,  or 
debtor,  of  the  defendant,  in  any  action  commenced  by 
process  of  foreign  attachment,  service  may  be  made 
upon  such  corporation  by  some  proper  officer,  by  leav- 
ing a  true  and  attested  copy  thereof,  at  least  twelve 
days  before  the  process  is  returnable,  with,  or  at  the 
usual  place  of  abode  of,  its  secretary  or  clerk,  or  any 
agent  or  clerk  employed  by  said  corporation  to  keep 
its  accounts,  or  pay  its  employees  in  the  town  where 
it  transacts  business,  and  where  any  moneys,  which 
may  be  owing  to  the  defendant,  are  due  and  payable. 
When  the  plaintiff  shall  recover  judgment  in  any 
action  so  brought  and  obtain  execution  for  the  same, 
a  demand  by  the  officer  serving  such  execution  on,  or 
at  the  usual  place  of  abode  of,  the  secretary,  agent,  or 
clerk  of  said  corporation  with  whom  service  was 
originally  made,  shall  be  a  sufficient  demand  of  said 
corporation. 

§  887.  Service  on  disbursing  agent  or  paymaster  of 
garnishee.  When  any  corporation  having  a  dis- 
bursing agent  or  paymaster,  with  an  office  or  place  of 


12  The  Corpoeation  Act 

business  in  this  state,  shall  he  named  as  garnishee, 
service  may  he  made  on  it  hy  leaving  with  such  agent 
or  paymaster,  or  at  his  said  office  or  place  of  husiness, 
or  at  his  usual  place  of  ahode,  a  duly  attested  copy  of 
the  process  in  said  action,  at  least  twelve  days  before 
the  return  day  thereof. 

§  888.  Service  on  bank  or  trust  company  as  gar- 
nishee. Whenever  a  bank,  savings  hank,  or  trust 
company,  is  named  as  garnishee,  process  shall  he 
served  hy  leaving  a  copy  thereof  at  the  garnishee's 
principal  office  during  its  regular  hours  of  business, 
or  by  leaving  such  copy  with  its  treasurer,  cashier,  or 
teller. 

§  895.     Levy  of  execution  as  a  discharge  of  garnishee. 

The  taking  of  any  effects  or  debt  hy  judgment  of  law 
out  of  the  hands  of  an  agent,  trustee,  or  debtor  of  the 
owner  thereof,  hy  process  of  foreign  attachment,  shall 
forever  discharge  such  garnishee. 

Attachment  of  stock  in  a  corporation  in  a  suit 
against  a  stockholder,  and  levy  of  execution  thereon 
are  provided  for  by  Gen.  St.,  Rev.  of  1902,  §§  833,  915. 

§  833.     Attachment  of  corporate  rights  or  shares. 

Rights  or  shares  in  the  stock  of  any  corporation, 
together  with  the  dividends  and  profits  due  and  grow- 
ing due  thereon,  may  he  attacked,  and  taken  on  execu- 
tion. Such  attachment  shall  he  made  hy  leaving  a 
true  and  attested  copy  of  the  process,  and  of  the 
accompanying  complaint  or  declaration,  with  the 
proper  indorsement  thereon,  of  the  officer  serving  the 
same,  as  in  other  cases,  with  the  defendant,  or  at  his 
usual  place  of  abode,  if  within  this  state,  and  with  the 
secretary,  clerk,  or  cashier  of  such  corporation,  or  if 
such  corporation  has  no  secretary,  clerk,  or  cashier, 
or  if  he  is  absent  from  this  state,  then  at  the  principal 
place  in  this  state  where  such  corporation  transacts 
its  husiness  or  exercises  its  corporate  powers;  and 
such  rights  or  shares,  together  with  the  dividends  and 


OF  Connecticut  13 

profits,  shall  he  holden  to  respond  to  the  judgment 
which  may  be  recovered  in  said  action,  for  sixty  days 
only  after  its  rendition;  and  when  an  officer  with  a 
writ  of  attachment  shall  apply  to  such  secretary, 
clerk,  or  cashier,  for  the  purpose  of  attaching  such 
rights  or  shares,  the  secretary,  clerk,  or  cashier,  shall 
furnish  him  with  a  certificate,  under  his  hand,  in  his 
official  capacity,  specifying  the  number  of  rights  or 
shares  which  the  defendant  holds  in  the  stock  of  such 
corporation,  with  the  incumbrances  thereon,  if  any, 
and  the  amount  of  dividends  thereon  due. 

§  915.     Levy  of  execution  on  corporate  stock.    The 

levy  of  an  execution  on  the  rights  or  shares  which  any 
person  owns  in  the  stock  of  any  corporation,  together 
with  the  interest,  dividends,  and  profits,  due  and 
growing  due  thereon,  shall  be  by  leaving  a  true  and 
attested  copy  thereof  with  the  secretary,  clerk  or 
cashier,  with  an  attested  certificate,  by  the  officer 
making  such  levy,  that  he  levies  upon  such  rights  or 
shares  to  satisfy  such  execution;  and  thereupon  such 
officer  shall,  as  in  other  cases,  post  and  sell  the  same, 
together  with  such  interest,  dividends,  and  profits,  or 
such  part  thereof  as  shall  be  sufficient  to  satisfy  such 
execution;  and  shall  give  to  the  purchaser  a  written 
conveyance  of  such  rights  or  shares;  and  shall  also 
leave  with  such  secretary,  clerk,  or  cashier,  a  true  and 
attested  copy  of  the  execution  and  of  his  return 
thereon;  and  the  purchaser  shall  thereupon  be  entitled 
to  all  dividends  and  stock,  and  to  the  same  privileges 
as  a  member  of  such  corporation  as  such  debtor  was 
entitled  to.  When  any  proper  officer  shall,  with  a  writ 
of  execution,  apply  to  such  secretary,  clerk,  or  cashier, 
for  the  purpose  of  so  levying  upon  such  rights  or 
shares,  the  secretary,  clerk,  or  cashier,  shall  furnish 
him  with  a  certificate  under  his  hand  in  his  official 
capacity,  stating  the  number  of  rights  or  shares  the 
defendant  holds  in  the  stock  of  such  corporation,  with 
the  incumbrances  thereon,  if  any,  and  the  amount  of 
dividends  thereon  due;  but  when  any  bank  incorpo- 


14  The  Cokporation  Act 

rated  'by  this  state,  or  any  hanking  association  located 
and  transacting  business  in  this  state,  has  no  cashier, 
or  the  cashier  is  absent  therefrom,  or  any  other  cor- 
poration incorporated  under  the  laws  of  this  state 
has  no  secretary  or  clerk  therein,  then  the  rights  or 
shares  in  the  stock  of  any  such  corporation  may  be 
taken  by  execution  by  leaving  the  copy  of  the  execu- 
tion and  the  certificates,  in  this  section  prescribed,  at 
the  principal  house  or  place  in  this  state,  where  such 
corporation  transacts  its  business  or  exercises  its  cor- 
porate powers. 

Shares  of  stock  in  a  Connecticut  corporation  which 
are  owned  by  a  nonresident  are  subject  to  attachment 
in  the  manner  prescribed  by  §  833  as  well  as  those 
owned  by  a  resident.  Barber  vs.  Morgan,  84  Conn. 
618. 

The  effect  of  indorsement  of  Negotiable  Paper  by  a 
corporation  is  covered  by  Gen.  St.,  Rev.  1902,  §  4192, 
as  follows : 

§  4192.     Indorsement  of  corporation  or  infant.     The 

indorsement  or  assigmnent  of  the  instrument  by  a 
corporation  or  by  an  infant  passes  the  property 
therein,  notwithstanding  that  from  want  of  capacity 
the  corporation  or  infant  may  incur  no  liability 
thereon. 

Admission  of  Capacity  to  Contract.  ' '  In  an  action  by 
a  corporation,  foreign  or  domestic,  founded  upon  any 
contract,  express  or  implied,  the  defendant  shall  not, 
under  a  general  denial,  be  permitted  to  dispute,  but 
shall  be  deemed  to  admit  the  capacity  of  the  plaintiff 
to  make  such  contract."  Connecticut  Practice  Book, 
1908,  P.  250,  §  161. 

Seal.  An  agent  of  a  corporation  in  executing  a  deed 
must  affix  the  corporate  seal  in  order  to  make  it  the 
act  and  deed  of  the  corporation,  Savings  Bank  of  New 
Haven  vs.  Davis  &  Center  et  al.,  8  Conn.  191;  but 
the  appointment  of  the  agent  to  make  the  deed  need 


OF  Connecticut  15 

not  itself  be  by  a  power  under  seal,  id.,  and  it  is  not 
necessary  that  the  vote  be  recorded  with  the  deed  in 
the  town  records.  Beckwith  vs.  Windsor  Mfg.  Co., 
14  Conn.  594.  Gen.  St.,  Rev.  of  1902,  §  4029,  requir- 
ing a  power  of  attorney  to  convey  land  to  be  executed 
in  like  manner  as  a  deed  does  not  apply  to  a  power 
to  an  officer  of  the  corporation  given  by  a  vote  to 
transfer  corporate  land.  Howe  et  als.  vs.  Keeler,  27 
Conn.  538. 

Gen.  St.,  Rev.  of  1902,  §  711,  provides  as  follows : 

Seal  and  its  equivalent.  ^^All  instruments  in  writ- 
ing executed  hy  any  person  or  corporation  not  having 
an  official  or  corporate  seal,  purporting  and  intended 
to  he  a  specialty  or  under  seal,  and  not  otherwise 
sealed  than  hy  the  addition  of  the  word  seal  or  the 
letters  L.  S.,  or,  in  the  case  of  an  official  or  corporate 
seal,  hy  an  impression  of  such  seal  upon  the  paper 
or  other  material  employed,  shall  he  deemed  in  all 
respects  sealed  instruments,  and  received  in  evidence 
as  such." 

As  to  powers  of  corporations  organized  under 
general  laws,  see  §  59,  infra,  page  100. 

Extent  of  Powers.  A  corporation  has  only  such 
rights  as  are  granted  it  by  its  charter,  expressly  or  by 
necessary  implication,  or  are  given  it  by  statute.  A 
corporation  chartered  to  carry  on  an  insurance  busi- 
ness has  been  held  not  empowered  to  loan  money  by 
discounting  notes,  such  power  not  being  necessary  to 
carry  into  effect  any  power  expressly  granted.  New 
York  Firemen  Insurance  Co.  vs.  Ely  &  Parsons,  5 
Conn.  560.  Nor  can  a  manufacturing  corporation 
transfer  all  its  property  to  another  corporation 
created  for  that  purpose  and  carry  on  business 
through  the  agency  of  the  latter  company,  and  a  non- 
assenting  stockholder  may  obtain  equitable  relief. 
Byrne  vs.  Schuyler  Electric  Mfg.  Co.  et  al.,  65  Conn. 
336.     But  under  certain  circumstances  a  sale  of  the 


16  The  Corporation  Act 

entire  property  of  a  corporation  for  the  purpose  of 
paying  its  debts  and  winding  up  its  affairs  may  be 
legitimate.    Id.,  p.  348. 

A  court  of  equity  will  not,  upon  the  petition  of  a 
general  creditor,  restrain  a  corporation  from  convert- 
ing its  assets  into  money  by  a  sale  thereof  to  a  stock- 
holder, when  such  sale  is  not  in  fact  in  fraud  of  the 
stockholders  or  of  the  creditors,  nor  in  prejudice  of 
the  rights  of  either,  when  no  stockholder  objects,  and 
when  the  sale  is  made  for  an  adequate  price  with  the 
intent  to  apply  the  proceeds  to  the  payment  of  the 
full  amount  of  the  debts  of  the  company  or  an  equal 
proportion  of  every  debt.  Barr  vs.  Bartram  &  Fanton 
Mfg.  Co.  et  al.,  41  Conn.  506.  See  also  Bartholomew 
et  al.  vs.  The  Derby  Rubber  Co.,  69  Conn.  521. 

A  sale  by  officers,  however,  in  excess  of  their  powers, 
and  not  authorized  by  vote  of  the  corporation  or  the 
directors,  passes  no  title  to  the  property  so  sold. 
"Winsted  Hosiery  Co.  vs.  New  Britain  Knitting  Co., 
69  Conn.  565. 

As  a  practical  matter  a  corporation  which  wished 
to  sell  all  its  property,  pay  its  debts  and  distribute  the 
surplus,  if  any,  would  in  the  present  day  proceed 
under  §  29  and  wind  up  the  corporation. 

A  corporation  chartered  for  manufacturing  pur- 
poses cannot  legally  take  a  lease  of  land  of  no  value 
to  it  for  such  purposes,  but  with  the  sole  object  of 
commencing  a  suit  against  another  corporation  for 
flowing  the  land  and  harassing  it  under  the  forms  of 
law.    Occum  Co.  vs.  Sprague  Mfg.  Co.,  34  Conn.  529. 

The  articles  of  incorporation  of  a  corporation 
formed  under  general  law  stand  on  the  same  footing 
as  defining  the  powers  of  such  corporation,  as  does 
the  charter  of  a  corporation  specially  chartered. 
Thus  a  railroad  organized  under  general  laws  of  a 
state  has  no  power  to  accept  a  lease  of  another  rail- 
road, such  lease  not  being  authorized  by  the  general 
laws  of  the  state,  and  in  an  action  for  rent  accrued 
it  may  set  up  the  illegality  of  the  lease.  Oregon  Ry. 
&  Navigation  Co.  vs.  Oregonian  Ry.  Co.,  130  U.  S.  1. 


OF  Connecticut  17 

A  corporation  cannot  exercise,  under  claim  of 
authority  by  general  laws,  a  power  which  is  expressly 
excepted  out  of  the  powers  granted  by  its  charter. 
Farrell  vs.  Winchester  Ave.  Railroad  Co.  et  als.,  61 
Conn.  127.  Similarly  a  provision  in  the  charter  of  a 
fire  insurance  company  that  its  consent  to  double 
insurance  must  be  endorsed  upon  the  policy,  cannot 
be  waived  by  it  so  as  to  allow  such  consent  to  be 
proved  by  any  other  evidence  than  such  indorsement. 
Couch  vs.  City  Fire  Insurance  Co.  of  Hartford,  38 
Conn.  181. 

Repeated  doing  of  an  act  not  authorized  by  charter 
or  statute  cannot  make  the  doing  of  such  act  lawful, 
as  power  cannot  be  acquired  by  its  repeated  unlawful 
exercise.  So  an  ordinary  private  manufacturing  cor- 
poration has  no  power  to  accept  drafts  having  no 
connection  with  its  business,  though  it  has  done  so 
repeatedly,  and  may  set  up  in  defense  to  a  suit  on  such 
acceptance,  at  least  against  one  who  has  not  given 
value,  that  it  was  accepted  for  accommodation  merely. 
Webster  &  Co.  vs.  Howe  Machine  Co.,  54  Conn.  394. 

Though  in  general,  therefore,  a  corporation  is  not 
bound  by  a  contract  which  it  was  not  legally  em- 
powered to  make,  there  are  certain  cases  where  such 
ultra  vires  contracts,  if  not  expressly  prohibited  or 
tainted  by  fraud,  will  be  given  effect  after  partial  or 
full  performance.  See  Hitchcock  vs.  Galveston,  96 
U.  S.  341. 

Power  as  to  manufacture  of  electricity.  The  powers 
of  corporations  in  this  respect  are  definitely  limited 
by  Public  Acts  of  1909,  Chap.  254,  as  follows : 

'* Section  3916  of  the  general  statutes  is  hereby 
amended  to  read  as  follows:  No  person  or  corporation, 
unless  acting  under  authority  from  the  general 
assembly,  shall,  in  any  city  or  town  of  this  state  whose 
population  exceeds  fifteen  thousand,  manufacture  for 
sale  any  electricity  for  the  purposes  of  lighting  or 
power;  hut  this  section  shall  not  prevent  the  manu- 


18  The  Corporation  Act 

facture  or  distribution  of  electricity  for  the  purpose 
of  the  business  of  the  manufacturer  thereof,  or  the 
sale  thereof  for  use  in  or  on  buildings  or  land  owned 
or  used  by  such  manufacturer ;  nor  shall  this  section 
prevent  the  manufacture  of  electricity  for  sale  for  the 
use  of  others  in  so  far  as  it  can  be  so  used  without 
being  transmitted  or  conducted  upon,  under,  along,  or 
across  any  highway  or  public  grounds." 

Sec.  4.  Power  to  transact  business  outside  the 
state.  Every  corporation  organized  under  the 
provisions  of  this  act,  and  every  corporation 
heretofore  or  hereafter  organized  under  any 
general  or  special  law  of  this  state,  shall  have 
power,  subject  to  the  limitations  of  its  charter, 
certificate  of  incorporation,  articles  of  associa- 
tion, or  any  statute  affecting  it,  to  carry  on 
business  in  any  state  or  territory  of  the  United 
States,  or  in  any  foreign  country,  if  not  pro- 
hibited by  the  laws  of  such  state  or  territory  or 
foreign  country. 

NOTE. 

For  powers  of  a  state  to  limit  operations  of  a  for- 
eign corporation  seeking  to  do  business  within  its 
borders,  see  note  to  §  81,  infra,  page  122. 

Sec.  5.  Dividends  restricted.  No  corporation 
shall  pay  any  dividend  or  make  any  other  dis- 
tribution of  its  assets  except  from  its  net  profits 
or  actual  surplus,  unless  in  accordance  with  the 
law  allowing  the  reduction  of  stock,  or  upon  the 
dissolution  of  the  corporation.    The  secretary 


OF  Connecticut  19 

shall  enter  the  name  of  every  director  voting 
for  any  dividend,  or  any  other  distribution  of 
the  assets,  upon  the  records  of  the  corporation. 
Every  director  voting  for  a  dividend  or  other 
distribution  of  assets  in  violation  of  this  sec- 
tion shall  be  fined  not  more  than  five  hundred 
dollars.  If  such  payment  or  distribution 
renders  a  corporation  insolvent,  the  directors 
so  voting  shall  be  jointly  and  severally  liable,  to 
the  amount  so  paid  or  distributed,  to  any 
creditors  existing  at  the  date  of  such  vote  who 
shall  obtain  judgment  against  such  corporation 
on  which  execution  shall  be  returned  unsatis- 
fied. No  such  dividend  shall  be  paid  or  distri- 
bution made  unless  duly  voted  by  the  directors 
of  the  corporation. 

NOTES. 

Dividends  on  stock  held  in  trust.     This   is   covered 
by  Gen.  St.,  Rev.  of  1902 : 

§  377-  Who  entitled  to  stock  dividend  on  stock 
held  in  trust.  When  any  executor,  administrator,  or 
trustee  holds  or  shall  hold  shares  of  stock  in  a  private 
corporation,  whose  use  or  income  belongs  to  one  or 
more  persons,  and  in  which  there  is  a  remainder  in- 
terest in  another  person  or  persons,  all  stock  dividends 
made  by  such  corporation,  and  all  rights  to  subscribe 
for  new  stock  in  such  corporation,  shall  belong  to  the 
trust  fund,  and  shall  not  be  deemed  a  part  of  such  use 
or  income,  unless  otherwise  expressly  declared  in  the 
instrument  creating  said  trust,  or  unless,  in  case  of 
a  stock  dividend,  the  corporation  making  such  divi- 


20  The  Corpokation  Act 

dend  shall  expressly  declare  the  same  to  he  made 
from  the  earnings  of  the  corporation  since  the  forma- 
tion of  the  trust. 

Where  a  large  portion  of  surplus  has  been  set  aside 
and  invested,  and  the  stockholders  have  sold  their 
stock,  reserving  their  interest  in  said  specified  assets, 
which  are  later  divided  among  such  former  stock- 
holders, such  dividends  are  treated,  as  between 
remaindermen  and  holders  of  life  interests,  as  capital 
and  not  as  income.  Second  Universalist  Church  of 
Stamford  et  als.  vs.  Colegrove,  74  Conn.  79. 

Undistributed  profits,  or  surplus  in  any  form,  may, 
however,  be  invested  or  employed  in  the  business 
without  thereby  becoming  capital,  and  until  so  dedi- 
cated to  corporate  uses  through  the  process  of  a  stock 
dividend  do  not  cease  to  be  available  for  distribution 
as  dividends,  and  when  so  distributed  as  dividends 
belong  to  the  life  tenant,  such  transaction  being  in  no 
sense  a  liquidation  or  surrender  of  a  portion  of  its 
capital.  Smith,  Trustee,  vs.  Dana  et  als.,  77  Conn. 
543.  See  also  Boardman  et  als..  Trustees,  vs.  Board- 
man  et  al.,  78  Conn.  451;  Bulkeley  vs.  Worthington 
Ecclesiastical  Society,  78  Conn.  526;  Stamford  Trust 
Co.,  Trustee,  vs.  The  Yale  &  Towne  Mfg.  Co.  et  al., 
83  Conn.  43  at  52 ;  Bishop  vs.  Bishop,  81  Conn.  509 ; 
Green,  Trustee,  vs.  Bissell  et  als.,  79  Conn.  547; 
Boardman  et  als.  vs.  Mansfield  et  als..  Exec,  79 
Conn.  634. 

Section  377  is  perhaps  merely  declaratory  of  the 
common  law,  for  as  a  general  rule  stock  dividends, 
even  when  they  represent  net  earnings,  become  at  once 
part  of  the  capital  of  the  corporation,  Gibbons  vs. 
Mahon,  136  U.  S.  549 ;  and  belong  to  the  capital  of  a 
trust  fund  and  not  to  the  life  tenant.  Spooner  vs. 
Phillips  et  al.,  62  Conn.  62. 

For  distinction  between  cash  and  stock  dividends 
see  Terry  vs.  Eagle  Lock  Co.  et  als.,  47  Conn.  141. 

Where  a  corporation  received  shares  of  its  own 
stock  in  payment  of  a  debt  and  voted  to  distribute 


OF  Connecticut  21 

them  to  its  shareholders  pro  rata  ''as  a  stock  divi- 
dend" it  was  held  that  such  distribution  was  mis- 
named, and  that  it  was  as  much  of  a  cash  dividend 
as  if  the  debt  had  been  paid  in  cash  and  the  cash 
distributed,  and  therefore  was  to  be  treated  as  income 
rather  than  as  principal  where  it  was  paid  into  a 
trust.  Green,  Trustee,  vs.  Bissell  et  als.,  79  Conn. 
547. 

Where  a  trust  owned  stock  in  a  bank  which  con- 
solidated with  another  under  an  agreement  that  the 
assets  of  each  should  be  liquidated  and  any  surplus 
held  by  one  in  excess  of  that  held  by  the  other  should 
be  refunded  to  its  own  stockholders,  and  the  old  cor- 
poration dissolved,  it  was  held  that  the  sum  distrib- 
uted to  the  trust,  being  the  proceeds  of  liquidation, 
went  to  principal  and  not  to  income.  Curtis,  Trustee, 
vs.  Osborn  et  als.,  79  Conn.  555. 

Right  of  stockholders  to  dividends.  The  directors 
being  the  responsible  agents  of  a  corporation  the 
courts  will  not  interfere  with  their  discretion  in  its 
management  provided  such  discretion  is  fairly  exer- 
cised, and  they  cannot  ordinarily  be  compelled  in  the 
absence  of  fraud  to  declare  a  dividend  even  out  of 
earned  profits  if  they  deem  it  wiser  to  invest  such 
profits  in  the  business.  Spooner  vs.  Phillips,  62  Conn. 
62.  A  dividend  once  declared,  however,  out  of  actual 
profits  cannot  be  avoided  or  recalled  by  a  subsequent 
vote,  and  a  minority  of  the  stockholders  may  compel 
its  payment.  Beers  vs.  Bridgeport  Spring  Co.,  42 
Conn.  17;  Cogswell  vs.  Second  National  Bank,  78 
Conn.  75.  After  all  the  stockholders  but  the  plaintiff 
have  been  paid  a  dividend  which  has  been  declared 
the  corporation  cannot  set  up  in  defense  to  an  action 
by  him  that  the  dividend  has  not  been  earned,  Stod- 
dard vs.  Shetucket  Foundry  Co.,  34  Conn.  542 ;  but  a 
receiver  may  recover  from  a  director  and  stockholder 
dividends  received  by  him  when  he  knew  or  should 
have  known  that  the  corporation  was  then  insolvent, 
at  least  as  far  as  necessary  to  discharge  the  corporate 


22  The  Cokpokation  Act 

indebtedness.      Davenport,    Receiver,    vs.    Lines,    72 
Conn.  118. 

Unauthorized  distribution  of  Assets.  A  stockholder 
who,  knowing  the  corporation  is  insolvent,  sells  his 
stock  to  the  company  and  receives  payment  from  a 
debtor  of  the  corporation  whose  debt  the  corporation 
releases  is  liable  to  a  trustee  of  the  corporation  sub- 
sequently appointed  for  the  amount  so  received,  since 
the  substance  of  the  transaction  is  a  withdrawal  of 
assets  of  the  corporation.  Bush,  Trustee,  vs.  Ross, 
68  Conn.  29.  So  a  stockholder  who  conveys  his  stock 
to  the  corporation  and  receives  in  return  a  portion  of 
its  assets  is  liable  to  the  receiver  in  an  action  brought 
for  the  benefit  of  creditors,  even  though  he  acts 
through  an  agent  and  does  not  know  the  corporation 
is  the  purchaser,  the  essential  thing  being  that  he  has 
in  fact  received  a  portion  of  the  assets.  Crandall 
et  al..  Receivers,  vs.  Lincoln  et  als.,  52  Conn,  73. 

The  stock  of  a  company  is  its  only  basis  of  credit. 
It  is  of  vital  importance  that  the  law  should  rigidly 
guard  and  protect  the  capital  stock.  It  is  in  many 
respects  regarded  in  equity  as  a  trust  fund  for  the 
payment  of  debts,  to  which  the  creditors  have  a  right 
prior  to  any  claim  of  stockholders ;  and  courts  will  be 
astute  to  detect  and  defeat  any  scheme  or  device  which 
is  calculated  to  withdraw  this  fund  or  place  it  beyond 
the  reach  of  creditors.  Crandall  et  al..  Receivers,  vs. 
Lincoln,  52  Conn.  73.  See  also  Bush,  Trustee,  vs. 
Ross,  68  Conn.  29. 

A  dividend  on  the  capital  stock  of  a  corporation 
payable  in  stock  of  another  corporation  which  has 
been  purchased  by  the  first  corporation  out  of  earn- 
ings and  held  by  it  as  an  asset  and  distributed  so 
that  it  passed  from  its  control  and  ownership,  has  all 
the  characteristics  of  a  "  cash  dividend, ' '  and  §  377 
above  set  forth  does  not  apply  thereto.  Union  &  New 
Haven  Trust  Co.  vs.  Taintor  et  al.,  85  Conn. 
83  Atl.  697. 


OF  Connecticut  23 

Sec.  6.  Liability  for  causing  insolvency  by  re- 
ducing stock.  In  case  the  reduction  of  the  capi- 
tal stock  of  any  corporation  shall  render  it 
insolvent,  at  the  time  of  such  reduction,  the 
stockholders  voting  in.  favor  of  such  reduction 
shall  be  jointly  and  severally  liable,  to  the 
amount  of  such  reduction,  for  all  debts  of  the 
corporation  existing  at  the  time  of  such  vote, 
after  judgment  has  been  obtained  against  the 
corporation  and  execution  has  been  returned 
unsatisfied.  The  records  of  the  corporation 
shall  show  the  name  of  every  stockholder  voting 
in  favor  of  such  reduction.  No  such  reduction 
shall  be  valid  unless  the  names  of  the  assenting 
stockholders  appear  of  record  as  aforesaid,  nor 
unless,  within  thirty  days  from  the  date  of  the 
vote  authorizing  such  reduction,  a  copy  of  the 
certificate  filed  in  the  office  of  the  secretary  of 
the  state  shall  be  published  twice  a  week  for  two 
successive  weeks  in  a  newspaper  published  in 
this  state  and  having  a  circulation  in  the  town 
in  which  such  corporation  is  located. 

NOTES. 

How  stock  of  specially  chartered  corporation  may 
be  reduced.    See  §  52,  infra,  page  96. 

How  stock  of  corporation  organized  under  general 
laws  may  be  reduced.    See  §  74,  infra,  page  117. 

Sec.  7.  New  Certificates.  The  directors,  after 
a  reduction  of  capital  stock,  may  require  each 


24  The  Cokpoeation  Act 

stockholder  to  return  his  old  certificate,  and 
upon  the  return  thereof  shall  issue  a  new  cer- 
tificate for  the  number  of  shares  to  which  he  is 
entitled  after  the  reduction;  and  such  corpora- 
tion, after  such  reduction,  may  increase  its  capi- 
tal stock  to  any  amount  authorized  in  its 
charter,  certificate  of  incorporation,  articles  of 
association,  or  in  any  statute  affecting  it. 

Sec.  8.  Loans  to  officers  restricted.  No  officer 
or  director  of  any  manufacturing  corporation 
shall  borrow  any  of  the  funds  of  the  corpora- 
tion or  use  the  same  for  any  purpose  other  than 
the  business  of  the  corporation  without  paying 
interest  to  such  corporation  for  the  use  of  such 
money,  and  without  a  majority  vote  of  all  the 
directors  of  such  corporation  and  without  fur- 
nishing adequate  security  for  such  loan. 

Sec.  9.  Profits  may  be  shared  with  employes. 
Any  corporation  organized  after  May  thirty- 
first,  1886,  may  by  its  board  of  directors  dis- 
tribute to  the  persons  employed  in  its  service, 
or  any  of  them,  such  portion  of  the  profits  of  its 
business  as  said  board  may  deem  just  and 
proper.  Any  corporation  organized  on  or  prior 
to  May  thirty-first,  1886,  may  give  to  its  board 
of  directors  the  power  to  make  such  distribution 
by  a  majority  vote  of  all  the  stockholders  at  a 
meeting  warned  and  held  for  the  purpose. 


OF  Connecticut  25 

Sec.  10.  Directors.  The  property  and  affairs 
of  every  corporation  having  a  capital  stock 
shall  be  managed  by  three  or  more  directors, 
except  that  the  charter  of  a  specially  char- 
tered corporation  may  provide  otherwise.  Such 
directors  shall  be  stockholders,  except  as  here- 
inafter provided,  and  shall  be  chosen  annually 
by  the  stockholders  at  such  time  and  place  as 
may  be  provided  by  the  by-laws,  and  shall  hold 
ojffice  for  one  year  and  until  others  are  chosen 
and  qualified  in  their  stead ;  but  the  original  or 
amended  certificate  of  incorporation  of  any  cor- 
poration to  which  the  Corporation  Act  of  1901 
now  applies  may  provide  for  the  classification 
of  the  directors,  either  as  to  their  term  of  office, 
or  as  to  their  election  by  one  or  more  classes  of 
stockholders  exclusively,  or  both;  provided, 
that  no  director  shall  be  elected  for  a  shorter 
term  than  one  year  nor  for  a  longer  term  than 
five  years  and  the  classification  shall  be  such 
that  the  term  of  one  or  more  classes  shall  expire 
each  succeeding  year.  The  directors  or  trustees 
of  any  corporation,  or  the  governing  board  of 
any  corporation  having  no  directors  or  trustees, 
may  fill  any  vacancy  in  their  own  number  for 
the  unexpired  portion  of  the  term  or  until  such 
corporation  shall  fill  such  vacancy.  A  majority 
of  the  directors  shall  constitute  a  quorum  for 
the  transaction  of  business  unless  it  is  provided 
in  a  by-law  adopted  by  a  stockholders '  meeting 
that  less  than  a  majority  shall  constitute   a 


26  The  Corpoeation  Act 

quorum.  The  board  of  directors  of  any  cor- 
poration, by  the  affirmative  vote  of  a  majority 
of  the  whole  board,  may  appoint  from  the  direc- 
tors an  executive  committee  and  such  other 
committees  as  they  may  deem  judicious,  and,  to 
such  extent  as  shall  be  provided  in  the  by-laws, 
may  delegate  to  such  committees  any  of  the 
powers  of  the  board  of  directors.  If  any  cor- 
poration holds  any  stock  in  any  other  corpora- 
tion, one  director  or  executive  officer  of  the  cor- 
poration holding  the  stock  as  aforesaid  may  be 
chosen  director  of  such  other  corporation 
whether  he  is  a  stockholder  in  such  other  cor- 
poration or  not,  but  not  more  than  one  director 
or  executive  officer  of  the  corporation  holding 
the  stock  shall  be  a  director  in  the  other  cor- 
poration unless  eligible  as  a  stockholder  there- 
in. At  least  once  in  each  year  the  directors  of 
every  corporation  shall  make  a  full  and  detailed 
report  of  the  financial  condition  of  the  corpora- 
tion to  its  stockholders,  which  report  shall  be 
filed  with  the  treasurer  of  the  corporation,  or, 
if  there  be  no  such  officer,  with  the  president, 
and  be  subject  to  the  inspection  of  the  stock- 
holders at  all  reasonable  times.  Such  report 
shall  contain  a  statement  of  the  number  of 
shares  of  stock  and  the  amount  of  other  secu- 
rities issued  by  any  other  corporation  and 
owned  by  the  corporation  making  the  report, 
with  the  name  and  location  of  such  other  cor- 
porations.    Subject  to  the  by-laws  adopted  by 


OF  Connecticut  27 

the  stockholders,  the  directors  of  any  corpora- 
tion may  make  and  alter  by-laws. 

NOTES. 

Management.  The  property  and  affairs  of  a  cor- 
poration are  under  the  management  and  control  of 
the  directors  and  the  details  are  left  to  their  discre- 
tion. The  courts  will  not,  in  general,  interfere  with 
the  exercise  of  that  discretion  so  long  as  they  act  in 
good  faith.  Angell  &  Ames  on  Corporations,  §  314. 
They  may  therefore  pass  dividends  and  apply  profits 
to  an  enlargement  of  the  business,  always  keeping 
within  the  objects  for  which  the  company  was  formed, 
Pratt  et  al.  vs.  Pratt,  Read  &  Co.,  33  Conn.  446; 
Smith,  Trustee,  vs.  Dana  et  al.,  77  Conn.  543;  but 
after  declaring  a  dividend  they  cannot  withhold  its 
payment  when  it  can  be  paid  without  serious  injury 
to  the  business.  Beers  vs.  The  Bridgeport  Spring  Co., 
42  Conn.  17. 

Chosen  annually  and  for  one  year.  '*It  seems 
doubtful  whether  the  provisions  of  the  statute  requir- 
ing directors  to  be  chosen  annually,  and  for  the  term 
of  one  year,  were  intended  to  apply  to  those  who 
might  be  appointed  upon  an  increase  of  the  number 
of  directors  by  an  amendment  of  the  by-laws  at  a 
special  meeting,  and  whether,  without  changing  the 
date  of  the  annual  meeting,  such  additional  directors 
might  not  be  appointed  to  hold  office  until  the  time 
of  the  next  annual  meeting."  Gold  Bluff  M.  &  L. 
Corporation  vs.  Whitlock  et  al.,  75  Conn.  669. 

Quorum.  Measures  passed  by  the  majority  of  the 
quorum  of  directors  at  any  meeting  are  considered  as 
having  been  passed  by  the  board,  except  in  cases  where 
it  may  be  prescribed  by  statute,  charter,  or  by-laws 
that  there  must  be  a  majority  vote  of  all  the  directors. 
See  Morawetz  on  Corporations,  §  247. 

As  to  votes  purporting  to  be  passed  by  the  directors 
of  a  corporation,  the  law  presumes  they  are  passed  by 


28  The  Cokpokation  Act 

legal  directors  in  the  absence  of  evidence  to  the  con- 
trary. Fairfield  County  Turnpike  Co.  vs.  Thorp,  13 
Conn.  173. 

When  the  meeting  of  a  board  of  directors  of  a  New 
Haven  bank  was  called  by  the  cashier  under  instruc- 
tions from  the  president,  then  in  New  York,  by  per- 
sonal notice  to  the  directors  in  New  Haven  without 
specifying  the  object  of  the  meeting,  it  was  held  that 
this  was  a  legal  meeting  for  ordinary  transactions, 
including  the  giving  of  a  mortgage  of  the  bank's  real 
estate  to  remove  a  debt.  Savings  Bank  of  New  Haven 
vs.  Davis  &  Center  et  als.,  8  Conn.  191. 

The  management  of  a  corporation  cannot  be  par- 
alyzed by  every  absence  of  a  director  from  its  place 
of  business  or  from  the  state  at  a  time  when  a  meet- 
ing of  the  board  seems  necessary.  Notice  to  a  major- 
ity, in  such  a  case,  if  they,  being  all  that  can  be 
reached,  proceed  to  hold  the  meeting,  will,  in  the 
absence  of  any  by-law  to  the  contrary,  support  their 
action;  at  least  if,  as  in  the  present  instance,  the 
others  subsequently  sign  and  file  a  waiver  of  notice, 
and  the  corporation  acquiesces  in  what  was  done  by 
making  it  the  basis  of  a  claim  of  legal  right.  Stafford 
Springs  St.  Ry.  Co.  vs.  Middle  River  Mfg.  Co.  et  al., 
80  Conn.  37. 

Where  the  record  book  showed  that  a  quorum  was 
present  at  a  directors'  meeting,  it  was  held  as  pre- 
sumptive proof  that  all  the  directors  had  been  duly 
notified  of  the  meeting.  Lane  vs.  Brainerd,  30  Conn. 
565.  Business  may  be  transacted  without  previous 
notice  when  a  majority  of  the  directors,  happening 
to  be  together,  all  agree  to  hold  a  meeting  at  once  for 
that  purpose.  Chase  vs.  Tuttle,  55  Conn.  455.  But 
there  is  no  presumption  that  a  conference  of  the 
majority  is  a  regular  meeting  when  no  record  of  the 
conference  has  been  made.  New  Haven  Trust  Co., 
Receiver,  vs.  Doherty  et  al.,  75  Conn.  555. 

Obligations  of  Directors  and  their  liability.  Direct- 
ors of  a  corporation  stand  for  many  purposes  in  the 


OF  Connecticut  29 

position  of  trustees.  They  may  be  called  to  account 
for  fraudulent  mismanagement  of  the  corporate 
property  or  compelled  to  declare  dividends  when  they 
are  improperly  withheld.  Pratt  vs.  Pratt,  Read  &  Co., 
33  Conn.  446.  If  they  mismanage  the  corporate 
affairs  for  their  own  benefit,  a  minority  of  the  stock- 
holders may  maintain  a  suit  in  equity  against  them 
for  an  account  and  an  injunction.  Sears  vs.  Hotch- 
kiss  et  als.,  25  Conn.  171. 

Directors  have  no  right  under  any  circumstances  to 
use  their  official  positions  for  a  purpose  hostile  to  the 
corporation.    Heminway  vs.  Heminway,  58  Conn.  443. 

Contracts  made  by  the  directors  with  the  corpora- 
tion advantageous  to  themselves  are  voidable,  though 
not  void.  If  ratified  they  are  in  equity  regarded 
with  suspicion  under  the  rule  that  one  acting  in  a 
fiduciary  capacity  should  not  use  the  relation  for  his 
personal  benefit.  Before  such  contracts  can  be  con- 
sidered ratified  by  acquiescence  alone  the  delay  must 
have  been  unreasonable,  the  stockholders  must  have 
been  advised  of  all  the  material  facts,  and  must  have 
had  an  opportunity  to  act  and  to  act  with  perfect 
freedom.  Mallory  vs.  Mallory  Wheeler  Co.,  61  Conn. 
131. 

An  agreement  made  by  a  majority  of  directors, 
privately,  that  they  should  be  paid  a  percentage  on 
all  money  raised  upon  the  credit  of  a  bond  of  in- 
demnity, signed  by  them  against  the  future  indebt- 
edness of  the  corporation,  is  not  binding  on  such 
corporation.  Butler  vs.  Cornwall  Iron  Co.,  22  Conn. 
335. 

Stockholders  cannot  sue  directors  for  misconduct 
in  office  without  showing  an  application  to  the  direct- 
ors for  action  by  the  corporation  and  refusal  on  their 
part  to  act.    Allen  vs.  Curtis,  26  Conn,  456. 

The  funds  of  a  corporation  cannot  lawfully  be 
withdrawn  and  used  to  adjust  equities  between  sub- 
scribers to  its  capital  stock  arising  out  of  their  respec- 
tive subscriptions;  and  a  director  who  knowingly 
receives  and  appropriates  to  his  own  use  the  corpora- 


30  The  Cokporation  Act 

tion's  money  for  such  a  purpose,  is  chargeable  with 
constructive  fraud,  and  is  bound  to  refund  the  amount 
to  a  trustee  in  bankruptcy  for  the  benefit  of  the 
creditors  of  the  insolvent  corporation.  Baldwin, 
Trustee,  vs.  Wolff,  82  Conn.  559. 

Directors  are  bound  to  manage  the  affairs  of  the 
corporation  with  reasonable  diligence  and  ordinary 
care,  that  care  which  an  ordinarily  prudent  man 
takes  in  the  management  of  his  own  concerns.  Angell 
&  Ames  on  Corporations,  §  314. 

The  law  requires  of  them  good  faith  and  ordinary 
diligence  and  care  in  the  performance  of  their  duties. 
Briggs  vs.  Spaulding,  141  U.  S.  132 ;  Martin  vs.  Webb, 
110  U.  S.  7,  15. 

It  is  difficult  to  say  what  degree  of  neglect  will 
make  a  delinquent  director  liable  for  loss.  A  director 
who  diligently  attends  to  his  duties  and  acts  accord- 
ing to  his  best  judgment  will  rarely  be  held  to 
account.  But  a  director  is  sometimes  liable  for  a 
breach  of  duty  of  fellow  directors  in  which  he  took 
no  part,  as,  for  example,  if  owing  to  his  absence  with- 
out excuse  from  a  series  of  meetings  they  are  enabled 
to  commit  a  wrong.  See  53  Am.  Dec.  642.  And  it 
has  been  held  that  where  directors  relied  entirely  on 
reports  rendered  by  an  officer  without  inspecting  the 
accounts  themselves,  they  are  liable  for  false  infor- 
mation published  by  them  in  an  annual  statement. 
See  note  to  Hodges  vs.  New  England  Screw  Co.,  53 
Am.  Dec.  642. 

Directors  who  are  negligent  in  making  a  loan  with- 
out investigating  the  security  are  liable  to  the  receiver 
for  the  loss  thereby  caused.  New  Haven  Trust  Co., 
Eeceiver,  vs.  Doherty  et  al.,  75  Conn.  555.  So  direct- 
ors are  liable  to  the  receiver  for  diversion  of  assets  by 
declaring  dividends  fraudulently  and  in  bad  faith 
while  capital  is  impaired.  Davenport,  Receiver,  vs. 
Lines,  77  Conn.  473. 

It  is  the  custom  to  give  a  small  sum  to  each  director 
attending  each  meeting,  in  order  to  secure  attendance, 
but  directors  are  not  legally  entitled  to  any  remunera- 


OF  Connecticut  31 

tion  for  their  services  as  directors  even  in  promoting 
the  credit  of  the  company,  nor  for  any  other  services 
except  such  as  are  clearly  outside  those  duties  which 
they  owe  as  directors.  New  York  &  New  Haven  Rail- 
road Company  vs.  Ketchum,  27  Conn.  170. 

Sec.  11.  Corporation  may  acquire  its  own  stock. 
Any  corporation  not  prohibited  by  any  provi- 
sion in  its  charter,  articles  of  association,  or 
certificate  of  incorporation  or  by  any  general 
law,  except  a  bank,  trust  company,  or  life 
insurance  company,  may  acquire,  purchase,  and 
hold  the  stock  or  securities  of  any  other  cor- 
poration. Any  such  corporation,  except  a  bank, 
trust  company,  or  life  insurance  company,  may 
acquire,  purchase,  and  hold  its  own  stock.  No 
corporation  shall  acquire,  purchase,  and  hold 
its  own  stock  unless  to  prevent  loss  upon  a  debt 
previously  contracted,  except  with  the  approval 
of  stockholders  owning  three-fourths  of  its 
entire  outstanding  capital  stock  given  at  a 
stockholders'  meeting  warned  and  held  for  the 
purpose;  and  such  corporation  shall  not  vote 
upon  shares  of  its  own  stock.  No  corporation 
shall  purchase  any  of  its  own  stock  when  it  is 
insolvent,  or  by  such  purchase  render  itself 
immediately  insolvent.  If  any  corporation 
shall  purchase  its  own  stock  when  it  is  insol- 
vent, or  so  render  itself  immediately  insolvent, 
the  directors  assenting  to  such  purchase  shall 
be  personally  liable  for  any  debts  of  such  cor- 
poration existing  at  the  time  of  such  purchase. 


32  The  Cokporation  Act 

The  president  and  treasurer  of  every  corpora- 
tion acquiring  its  own  stock  under  the  provi- 
sions of  this  section  shall,  within  six  months 
thereafter,  make,  sign,  and  swear  to  and  file  in 
the  office  of  the  secretary  of  the  state  a  certifi- 
cate stating  the  number  of  shares  of  its  own 
stock  so  acquired,  and  the  secretary  shall  there- 
upon record  such  certificate  in  a  book  kept  by 
him  for  that  purpose. 

NOTES. 

A  corporation  may  if  solvent  purchase  its  own 
stock  from  an  agent  retiring  from  the  business  and 
pay  for  the  stock  by  mortgaging  its  real  estate  to  the 
agent.  See  Smith,  Trustee,  vs.  Gaylord  et  als.,  47 
Conn.  380. 

The  provision  in  the  certificate  of  incorporation  of 
a  grocery  company  whereby  creditors  of  the  partner- 
ship which  the  corporation  succeeded  were  allowed 
to  take  preferred  stock  in  it  for  their  claims,  to  trade 
out  the  par  value  of  their  stock  for  groceries  furnished 
by  the  corporation  is  a  lawful  provision  and  is  not 
in  violation  of  the  prohibition  in  the  foregoing  section 
against  purchase  of  its  own  stock  by  an  insolvent  cor- 
poration, since  this  corporation  at  its  organization  had 
no  debts.    Butler,  Receiver,  vs.  Beach,  82  Conn.  417. 

Sec.  12.  Receipts  for  payment  of  stock  subscrip- 
tion ;  directors'  liability.  No  corporation  shall 
issue  any  certificates  for  stock  until  the  stock 
has  been  subscribed  and  paid  for  in  full.  The 
treasurer  of  such  corporation  shall  issue  and 
deliver  to  each  subscriber  a  receipt,  counter- 


OF  Connecticut  33 

signed  by  the  secretary  and  under  the  corporate 
seal,  stating  the  amount  such  subscriber  has 
paid  on  his  subscription,  and  the  number  of 
shares  of  full  paid  and  non-assessable  stock  for 
which  he  or  his  transferee,  upon  the  payment 
of  the  balance  due  upon  his  said  subscription, 
will  be  entitled  to  receive  a  certificate.  Said 
officers  shall  enter  upon  such  receipt  the  dates 
and  amounts  of  all  subsequent  payments.  The 
persons  to  whom  such  receipts  are  issued  shall 
be  deemed  to  be  stockholders.  If  any  stock 
shall  be  paid  for  otherwise  than  in  cash,  a 
majority  of  the  directors  shall  make  and  sign 
upon  the  record  book  of  the  corporation  a  state- 
ment showing  particularly  of  what  the  property 
received  in  payment  for  stock  subscriptions 
consists,  and  that  it  has  an  actual  value  equal 
to  the  amount  for  which  it  is  so  received.  The 
judgment  of  the  directors  as  to  the  value  of 
property  accepted  in  payment  of  stock  shall  be 
final ;  but  the  directors  concurring  in  the  judg- 
ment of  such  value,  in  case  of  fraud  in  the  over- 
valuation of  such  property,  shall  be  jointly  and 
severally  liable  to  the  corporation  for  the 
amount  of  the  difference  between  the  actual 
value  of  any  property  so  accepted  in  payment 
at  the  time  of  such  acceptance,  and  the  amount 
for  which  it  is  received  in  payment.  The  secre- 
tary shall  keep  a  record  of  the  names  of  the 
directors  concurring  in  such  judgment  of 
values. 


34  The  Cokpokation  Act 


NOTE. 


The  controlling  purpose  of  this  section  is  not  so 
much  to  require  a  technical  subscription  as  it  is  to 
prevent  the  issue  of  any  certificate  for  shares  of  stock 
that  have  not  in  some  way  been  fully  paid  up,  because 
such  a  certificate  might  mislead  those  dealing  with 
the  holder  by  inducing  them  to  suppose  that  his  stock 
was  liable  to  no  assessments.  To  give  it  this  effect,  the 
word  "subscriber"  must  and  properly  may  be  taken 
as  used  to  include  every  shareholder,  whether  he  be- 
came such  by  signing  a  subscription  paper,  or  by  pur- 
chase from  one  who  had  so  subscribed,  or  his  assigns, 
or  by  purchase  from  the  corporation.  Stamford 
Trust  Co.  vs.  Yale  &  Towne  Mfg.  Co.,  83  Conn.  43. 

This  seietion  does  not  forbid  stock  dividends  to  those 
who  have  not  made  a  technical  subscription  for  the 
stock.     Stamford  Trust  Co.  Case,  supra. 

Sec.  13.  Calls  for  stock  subscriptions.  The 
directors  of  every  corporation  may  call  in  the 
subscriptions  to  its  capital  stock  by  instalments 
in  such  proportion  and  at  such  times  and  places 
as  they  think  proper,  provided  they  give  its 
subscribers  or  stockholders  such  notice  as  the 
by-laws  provide,  or,  in  the  absence  of  such  pro- 
vision, such  notice  as  they  deem  reasonable,  of 
the  amount  of  such  instalments  and  the  time 
when  they  are  payable. 

Sec.  14.  Stock  subscriptions  not  made  in  good 
faith.  When  any  commissioners  or  incorpora- 
tors authorized  to  receive  subscriptions  to  the 
capital  stock  of  any  corporation  shall  be  satis- 
fied that  any  subscription  is  not  made  in  good 


OF  Connecticut  35 

faith,  they  shall  disallow  it,  and  return  to  the 
person  subscribing  such  instalment  as  has  been 
paid  by  him. 

NOTE. 

Stock  subscriptions,  cancellation  of.  A  decree  can- 
celling all  the  subscriptions  to  the  capital  stock  of  a 
duly  organized  corporation  ought  not  to  be  rendered 
against  the  company  merely  because  one  of  the  sub- 
scribers has  failed  to  keep  his  contract  with  the  rest, 
unless  the  corporation  was  a  party  to  such  contract 
or  assented  to  it.  Subscribers  to  the  capital  stock  of 
a  corporation  cannot  ask  for  a  cancellation  of  their 
subscriptions  because  a  majority  of  the  shares  have 
been  subscribed  for  in  bad  faith  and  with  the  inten- 
tion not  to  pay  for  them  when  no  bad  faith  or  fraud 
on  the  part  of  the  corporation  is  claimed.  Simonds 
et  al.  vs.  East  Windsor  El.  Ry.  Co.  et  al.,  73  Conn. 
513. 

Sec.  15.  Stock  certificates.  Upon  payment  in 
full  for  his  stock  and  the  surrender  of  treas- 
urer's receipts,  if  any,  each  stockholder  shall 
be  entitled  to  a  certificate  under  the  seal  of  the 
corporation,  which  shall  be  signed  by  the  presi- 
dent or  vice-president  and  by  the  secretary  or 
assistant  secretary  or  the  treasurer  or  assistant 
treasurer,  certifying  the  number  of  shares 
owned  by  him  in  such  corporation. 

NOTE. 

Statements  on  the  margin  of  stock  certificates  show- 
ing the  amount  of  the  capital  stock,  the  number  of 
shares  and  the  par  value  of  each  are  as  much  a  part 


36  The  Cokpokation  Act 

of  the  certificate  as  they  would  have  been  if  embodied 
in  the  printed  portion  thereof.  Fish,  Receiver,  vs. 
Smith,  73  Conn.  377. 

Sec.  16.  Stockholders'  liability.  Every  stock- 
holder, whether  an  original  subscriber  or  not, 
shall  be  liable  for  any  balance  due  on  the  stock 
held  by  him.  If  a  corporation  is  placed  in  the 
hands  of  a  receiver  or  a  trustee  in  insolvency 
or  bankruptcy,  such  receiver  or  trustee  shall 
have  the  powers  of  the  board  of  directors  in 
calling  in  instalments  on  stock.  If  a  creditor 
of  a  corporation  shall  obtain  a  judgment 
against  it,  and  execution  thereon  shall  be 
returned  unsatisfied,  such  creditor  may  recover 
from  any  stockholder  in  such  corporation  the 
balance  remaining  due  and  unpaid  on  any  stock 
held  by  him,  so  far  as  may  be  necessary  to 
satisfy  the  debt.  No  subscriber  for  or  holder  of 
stock  shall  be  liable  as  such  for  any  payment  of 
such  stock,  or  for  any  debt  of  the  corporation, 
after  the  par  value  of  his  stock  has  been  paid. 

NOTES. 

Every  stockholder  is  presumed  to  know  the  pro- 
visions of  the  charter,  the  statute  laws  of  the  state, 
and  the  general  principles  of  law  governing  corpora- 
tions. The  charter  is  the  contract  of  membership. 
Each  stockholder  when  he  becomes  a  member,  either 
as  an  original  subscriber  to  the  stock  or  as  a  pur- 
chaser, is  bound  by  the  provisions  of  the  charter  and 
the  general  law  governing  corporations.  Crandall  vs. 
Lincoln,  52  Conn.  73,  100. 


OF  Connecticut  37 

If  a  corporation  becomes  insolvent  before  the  stock 
is  paid  up,  a  creditor  can  compel  the  payment  of  the 
unpaid  instalments  although  the  directors  refuse  to 
make  the  call.  Ward  et  als.  vs.  Griswoldville  Mfg.  Co., 
16  Conn.  593. 

A  corporation  cannot,  under  a  private  arrange- 
ment with  a  subscriber  to  its  stock,  receive  a  sub- 
scription for  less  than  its  par  value,  and  such  an 
agreement  is  invalid.    Mann  vs.  Cooke,  20  Conn.  178. 

One  who  subscribes  for  stock  as  trustee  for  the  cor- 
poration is  personally  liable.  Johnston,  Trustee,  vs. 
Allis,  71  Conn.  207. 

The  fact  that  an  increase  of  stockholders'  liability, 
pursuant  to  General  Statutes  §  3911,  would  attend 
entering  upon  the  business  of  generating  and  selling 
electricity,  would  not  make  a  charter  amendment 
whereby  a  corporation  was  authorized  to  utilize  cer- 
tain water  power  by  a  method  which  involved  its  con- 
version into  electricity  and  transmission  to  the  point 
of  use  by  means  of  an  electrical  generation  and  trans- 
mission plant,  a  fundamental  change.  Perkins  et  als. 
vs.  Coffin  et  als.,  84  Conn.  276. 

Present  limitations  upon  the  liability  of  stock- 
holders and  tax  exemptions  do  not  possess  the  char- 
acter of  contractual  rights  of  such  a  nature  that  the 
state  may  not,  in  the  exercise  of  its  reserved  power, 
change  them  for  the  protection  of  the  rights  of  the 
public  or  of  creditors.     (Ibid.) 

A  receiver  of  an  insolvent  corporation  can  issue 
calls  on  stock  or  sell  the  right  to  collect  unpaid  sub- 
scriptions.   Fish,  Receiver,  vs.  Smith,  73  Conn.  377. 

One  who  buys  originally  issued  shares  of  stock  from 
the  corporation  itself  occupies  substantially  the  posi- 
tion of  an  original  subscriber.  New  Haven  Trust  Co. 
vs.  Gaffney,  73  Conn.  480. 

A  corporation  has  power  to  compromise  a  bona  fide 
dispute  as  to  the  amount  that  is  due  from  a  stock- 
holder upon  his  stock,  and  such  compromise  agree- 
ment when  executed  is  a  valid  defense  not  only 
against  the  corporation  but  its  creditors  as  well.    New 


38  The  Corporation  Act 

Haven  Trust  Co.,  Receiver,  vs.  Nelson,  73  Conn.  477. 
Special  liability  of  stockholders  in  telegraph,  tele- 
phone, electric  light  or  power  companies  is  provided 
for  by  §3911  of  the  General  Statutes  of  1902,  as 
follows : 

§3911.  Stockholders  liable  for  debts.  The  stock- 
holders of  every  telegraph,  telephone,  or  electric  light 
or  power  company,  organized  under  the  laws  of  this 
state,  shall  he  jointly  and  severally  liable  to  any  cred- 
itor of  such  company  for  the  payment  of  any  debt 
due  to  him  contracted  or  due  during  the  time  of  their 
holding  stock  therein,  to  the  extent  of  twenty-five  per 
cent,  of  the  amount  of  stock  held  by  them  respec- 
tively; provided,  that  such  creditor  shall  first  obtain 
a  judgment  against  the  company,  and  an  execution 
thereon  shall  be  returned  unsatisfied,  and  suit  shall 
be  brought  against  such  stockholder  or  stockholders, 
while  they  respectively  continue  to  hold  any  of  such 
stock,  or  within  two  years  after  they  cease  to  hold  it. 

If  a  corporation  refuses  to  collect  unpaid  subscrip- 
tions to  its  capital  stock,  a  creditor  may  sue  the  sub- 
scribers and  the  corporation  for  the  purpose  of  en- 
forcing payment;  and  if  the  corporation  has  been 
dissolved  those  who  then  represent  it  under  the  law 
of  the  state  which  created  it,  may,  under  similar  cir- 
cumstances, be  made  defendants  in  its  stead.  Lewi- 
sohn  et  al.  vs.  Stoddard  et  als.,  78  Conn.  575,  592. 

The  debtor  of  an  insolvent  bank  cannot  set  off  as 
against  the  receiver  the  bills  of  the  bank  which  he 
held  at  the  time  the  note  upon  which  he  is  sued  fell 
due.    The  Eastern  Bank  vs.  Capron,  22  Conn.  639. 

An  amendment  to  the  charter  of  the  New  Haven  & 
Derby  Railroad  authorizing  the  City  of  New^  Haven 
to  subscribe  for  its  stock  did  not  impair  the  rights  of 
the  defendants  as  stockholders  or  relieve  them  from 
liability  on  their  subscriptions.  New  Haven  &  Derby 
R.  R.  Co.  vs.  Chapman,  38  Conn.  56. 

The  promoter  of  a  corporation  is  estopped  to  set  up 
irregularities  in  its  organization  as  a  defense  to  an 


OF  Connecticut  39 

action  by  a  trustee  in  insolvency  to  recover  un- 
paid instalments.  Canfield,  Trustee,  vs.  Gregory,  66 
Conn.  9. 

It  is  doubtful  if  an  original  subscriber  to  the  stock 
of  a  corporation  can  avoid  his  obligation  by  showing 
that  it  was  procured  by  fraud  in  its  organization,  but 
a  purchaser  of  transferable  shares  may  set  up  the 
fraud  as  a  defense  to  his  note,  even  after  the  insol- 
vency of  the  corporation,  and  against  the  receiver. 
Litchfield  Bank  vs.  Peck,  29  Conn.  384;  Litchfield 
Bank  vs.  Church,  29  Conn.  137. 

A  parol  condition  annexed  to  a  subscription  for 
stock  cannot  be  shown.  Fairfield  County  Turnpike 
Co.  vs.  Thorp,  13  Conn.  173. 

A  court  of  eq^uity  may  cancel  subscriptions  obtained 
by  fraud  and  allow  stockholders  to  recover  the  amount 
paid  thereon.  Goodman  vs.  White  et  al.,  26  Conn.  317. 

An  agreement  by  the  officers  of  a  corporation  ap- 
proved by  a  vote  of  the  directors  releasing  a  stock- 
holder from  liability  to  pay  his  subscription  in  full, 
and  accepting  a  smaller  amount  in  settlement  will  be 
set  aside  as  a  fraud  on  the  creditors,  if  the  corporation 
afterwards  becomes  insolvent.  Northrop,  Trustee,  vs. 
Bushnell,  38  Conn.  498. 

Until  the  transfer  of  stock  is  actually  made,  the 
legal  title,  and  the  legal  rights  and  liabilities  of  the 
stockholder  of  record,  remain  unchanged.  A  receiver 
may,  therefore,  recover  an  unpaid  assessment  from 
a  stockholder  of  record  although  such  stockholder  had 
contracted  with  a  third  person  to  take  the  shares,  and 
the  third  person  wrongfully  refused  to  accept  them 
and  declined  to  allow  the  same  to  be  transferred  to 
him.    Kussell,  Receiver,  vs.  Easterbrook,  71  Conn.  50. 

One  who  retains  shares  of  stock  irregularly  issued 
and  for  years  receives  dividends  thereon,  with  knowl- 
edge, actual  or  constructive,  of  the  circumstances 
under  which  the  stock  is  issued,  is  estopped  from 
setting  up  such  irregularities  in  an  action  by  the 
receiver  of  the  insolvent  corporation  to  recover  the 


40  The  Corporation  Act 

balance  due  on  his  stock  subscription.  Barrows  vs. 
The  Natchaug  Silk  Co.,  72  Conn.  658. 

A  stockholder,  whose  subscription  is  obtained  by- 
fraudulent  representations  of  which  he  has  knowledge 
or  the  means  of  knowledge,  must  act  promptly  in 
rescinding  his  contract,  or  he  will  be  bound  thereby. 
(Ibid.) 

The  statute  of  limitations  begins  to  run  against  an 
action  against  a  stockholder  in  an  insolvent  corpora- 
tion in  the  hands  of  a  receiver  to  recover  unpaid  as- 
sessments on  his  stock,  when  the  court  orders  the 
assessment  to  be  made.  Glenn  vs.  Marbury,  145  U.  S. 
499. 

Unpaid  instalments  of  increased  capital  stock  are 
subject  to  call  to  pay  creditors  whose  debts  accrued 
subsequent  to  the  authorization  of  the  increase,  but 
not  to  pay  creditors  whose  debts  were  contracted 
prior  to  such  authorization.  Handley  vs.  Stutz,  139 
U.  S.  417. 

Liability  of  stockholders  under  laws  of  other  states. 

Several  cases  have  arisen  in  this  state  where  it  was 
sought  to  enforce  the  liability  of  a  stockholder  for 
assessments  on  unpaid  stock  subscriptions  under  the 
laws  of  the  states  which  created  the  corporation,  and 
such  liability  has  been  uniformly  enforced  by  our 
courts.  Fish,  Receiver,  vs.  Smith,  73  Conn.  377; 
Lewisohn  et  al.  vs.  Stoddard  et  als.,  78  Conn.  575; 
Converse,  Receiver,  vs.  JEtna  Nat.  Bank,  79  Conn.  163. 

The  stockholder's  liability  to  pay  his  share  of  the 
debts  of  the  corporation,  in  the  event  of  its  insolvency, 
depends  upon  and  must  be  determined  by  the  laws 
of  the  state  creating  the  corporation  which  were  in 
force  when  he  became  a  stockholder.  The  mode  of 
enforcing  this  liability  may  be  varied  within  reason- 
able limits  by  subsequent  legislation,  but  the  amount 
of  such  liability  cannot  thereafter  be  materially  in- 
creased without  the  stockholder's  assent.  Converse, 
Receiver,  vs.  JEtna  Nat.  Bank,  79  Conn.  163. 

Applying  this  rule  the  Supreme  Court  of  this  state 


OP  Connecticut  41 

in  the  above  case  held  unconstitutional  a  statute  of 
the  State  of  Minnesota  enacted  in  1899  which  radi- 
cally changed  the  statutory  procedure  for  enforcing 
the  double  liability  of  stockholders  imposed  by  its 
Constitution,  holding  that  in  respect  to  those  stock- 
holders who  became  such  prior  to  the  passage  of  the 
act,  it  was  unconstitutional  as  an  attempt  to  increase 
their  obligations  under  contracts  previously  made, 
which  if  effectual,  would  amount  to  a  deprivation  of 
their  property  without  due  process  of  law. 

This  judgment  was  reversed  on  writ  of  error  to  the 
United  States  Supreme  Court,  on  the  authority  of 
Bernheimer  vs.  Converse,  206  U.  S.  516,  in  the  case  of 
Converse  vs.  First  Nat.  Bank  of  Suflfield,  212  U.  S. 
567. 

Liability  of  Officers  for  fraud.  Representations  made 
by  the  president  of  a  corporation,  as  an  inducement 
to  buy  its  stock,  that  the  output  was  six  million  bricks 
a  year,  that  all  bricks  to  be  made  the  following 
summer  had  been  sold,  that  stock  would  yield  good 
income,  that  it  had  been  fully  paid  for  in  cash,  that 
there  was  none  for  sale  on  market,  that  defendant 
would  not  sell  his  for  $150,  and  that  no  assessment 
would  be  levied  on  it,  are  to  be  regarded  as  statements 
of  fact  and  not  mere  expressions  of  opinion,  and  con- 
sequently defendant  was  liable  to  one  having  bought 
stock  relying  on  such  representations.  Shelton  vs. 
Healy,  74  Conn.  265. 

Sec.  17.  Fractional  shares  or  rights.  No  cer- 
tificate for  fractions  of  shares  shall  be  issued. 
Whenever  fractional  rights  result  from  an 
increase  or  reduction  of  capital  stock  and  the 
stockholders  fail  to  combine  the  same  by  pur- 
chase or  sale,  the  directors  shall,  after  due 
notice,  sell  such  rights  to  the  highest  bidder  and 
issue  proper  certificates  therefor. 


42  The  Cokporation  Act 

See  Stamford  Trust  Co.  vs.  Yale  &  Towne 
Mfg.  Co.,  83  Conn.  51. 

Sec.  18.  Stock  books.  At  least  three  days 
before  every  stockholders^  meeting,  a  com- 
plete list  of  the  stockholders  entitled  to  vote, 
arranged  in  alphabetical  order,  shall  be  pre- 
pared by  the  secretary,  and  such  list  shall  be 
open  to  inspection  by  any  stockholder  at  the 
time  and  place  of  the  meeting.  Any  such  secre- 
tary who  neglects  or  refuses  to  produce  such  list 
at  any  meeting  or  refuses  to  permit  an  inspec- 
tion thereof  by  any  stockholder  entitled  to  vote 
shall  be  ineligible  for  election  to  any  office  in 
such    corporation    for    one    year  ^         ^  ^^ 

■*-  •'As  amended  by 

thereafter.  The  stock  ledger,  if  ch.  215.  Puwic 
there  be  one,  otlier\vise  the  transfer 
books  of  the  corporation  shall  be  prima  facie 
evidence  as  to  who  are  stockholders.  The  origi- 
nal or  duplicate  books  of  any  corporation  in 
which  the  transfers  of  stock  shall  be  registered, 
and  the  original  or  duplicate  books  containing 
the  names  and  addresses  of  the  stockholders 
and  the  number  of  shares  held  by  them,  respec- 
tively, shall,  at  all  times  during  the  usual  hours 
of  business,  be  open  to  the  examination  of  every 
stockholder  at  its  principal  office  or  place  of 
business  in  this  state,  and  such  original  or 
duplicate  books  shall  be  evidence  in  all  courts 
of  this  state. 


OF  Connecticut  43 

Sec.  19.  Lost  certificates.  Every  corporation 
may  issue  a  new  certificate  of  stock,  or  treas- 
urer's receipt  for  payment  on  subscription  for 
stock,  in  place  of  any  certificate  or  receipt 
issued  by  it  which  is  claimed  to  have  been  lost 
or  destroyed,  and  the  directors  may,  in  their 
discretion,  require  the  owner  of  a  lost  or 
destroyed  certificate  or  receipt,  or  his  legal  rep- 
resentatives, to  give  a  bond  to  the  corporation 
in  such  sum  as  the  directors  may  direct,  not 
exceeding  twice  the  value  of  the  stock  or  receipt, 
to  indemnify  the  corporation  against  any  claim 
that  may  be  made  against  it  on  account  of  the 
issue  of  such  new  certificate  or  receipt;  and  a 
new  certificate  or  receipt  may  be  issued  without 
requiring  any  bond  when,  in  the  judgment  of 
the  directors,  no  bond  is  necessary.  The 
superior  court  in  the  county  wherein  such  cor- 
poration is  located  shall,  for  due  cause  shown, 
upon  complaint  of  the  owner  of  a  lost  or 
destroyed  certificate  or  treasurer's  receipt, 
order  the  delivery  to  him  by  said  directors  of  a 
new  certificate  or  receipt  in  lieu  thereof,  and 
may  require  a  proper  bond  for  the  protection  of 
the  corporation  and  of  any  person  who  may  be 
interested  in  the  lost  certificate  or  receipt. 

Sec.  20.  Pledge  of  stock.  Shares  of  stock  in 
any  corporation  organized  under  the  laws  of 
this  state  or  of  the  United  States,  or  treasurer's 
receipts  for  payment  on   subscription  to  the 


44  The  Corpobation  Act 

stock  of  any  corporation  organized  under  the 
laws  of  this  state,  may  be  pledged  by  delivering 
the  certificate  of  such  stock  or  such  receipt  to 
the  pledgee,  with  a  power  of  attorney  for  its 
transfer;  but  no  such  pledge  shall  be  effectual 
to  hold  such  stock  against  any  person  other  than 
the  pledgor,  his  executor,  or  administrator, 
unless  there  shall  be  an  actual  transfer  of  the 
same  upon  the  books  of  the  corporation,  or 
unless  a  copy  of  such  power  of  attorney  shall 
be  filed  with  the  corporation. 

NOTES. 

Where  the  certificate  of  stock  and  the  power  of 
attorney  to  transfer  the  same  to  the  name  of  the 
pledgee  had  been  delivered,  but  no  actual  transfer 
had  been  made  on  the  books  of  the  company,  which 
had  no  notice  of  such  pledge,  the  trustee  in  insolvency 
of  the  stockholder  of  record  was  entitled  to  hold  the 
stock.  Shipman,  Trustee,  vs.  ^tna  Insurance  Co. 
et  als.,  29  Conn.  245. 

The  lien  of  a  corporation  on  its  stock  is  not  avoided 
by  a  pledge  of  the  stock  without  actual  transfer  or 
notice.  Piatt  vs.  Birmingham  Axle  Co.  et  als.,  41 
Conn.  255;  First  Nat'l  Bank  vs.  The  Hartford  Life 
&  Annuity  Insurance  Company  et  als.,  45  Conn.  22. 

Sec.  21.  Stock  transfer ;  corporation  lien.  The 
stock  of  every  corporation,  except  when  other- 
wise provided  in  the  charter  of  a  specially  char- 
tered corporation,  shall  be  personal  property, 
and,  with  the  treasurer's  receipts  for  payments 
on  stock  subscriptions,  shall  be  transferable 
only  on  its  books  in  such  form  as  the  by-laws 


OF  Connecticut  45 

shall  prescribe.  Whenever  any  transfer  of 
stock  shall  be  made  for  collateral  security,  the 
entry  of  the  transfer  on  the  books  of  the  cor- 
poration shall  state  that  it  is  made  for  collateral 
security.  Every  corporation  shall  at  all  times 
have  a  lien  upon  all  of  its  stock  owned  by  any 
person  for  all  debts,  including  instalments  duly 
called  in,  due  to  it  from  him,  and  may  sell  the 
debtor's  interest  in  said  stock,  or  in  so  much 
thereof  as  may  be  necessary  to  discharge  such 
indebtedness  and  the  expense  of  such  sale,  at 
public  auction  at  any  time  after  the  debt 
secured  thereby  becomes  due  and  payable,  upon 
giving  to  the  stockholder,  his  executor,  or  ad- 
ministrator, and  if  there  be  none,  his  heir-at- 
law,  a  written  notice,  by  mail,  of  at  least  twenty 
days  and  advertising  such  sale  at  least  twice  in 
a  newspaper  of  this  state  having  a  circulation 
in  the  town  where  such  corporation  is  located, 
not  less  than  one  week  prior  to  the  date  of  sale. 
Any  surplus  arising  from  such  sale  shall  be 
paid  to  the  stockholder. 

NOTES. 

A  mere  agreement  to  transfer  stock,  the  perform- 
ance of  which  is  prevented  by  an  intervening  attach- 
ment, passes  no  title  as  against  the  attaching  credi- 
tors, even  though  the  stock  certificate  is  delivered  and 
a  power  of  attorney  to  transfer  it.  Shipman  vs.  ^tna 
Insurance  Co.,  29  Conn.  245.  It  was  held  as  early 
as  1824  that  a  charter  providing  that  stock  should  be 
transferable  ''only  on  the  books  of  the  company"  did 


46  The  Corpokation  Act 

not  mean  that  the  original  transfer  must  be  on  the 
books,  but  that  a  written  assignment  executed  as 
required  by  the  by-laws  and  reasonably  registered  at 
length  on  the  books  was  a  transfer  on  the  books  of 
the  company,  Northrop  vs.  Curtis  et  als.,  5  Conn. 
246,  and  this  would  undoubtedly  be  held  today.  The 
equitable  title  to  stock,  however,  can  pass  by  con- 
tract or  by  sale  or  by  gift  by  the  delivery  of  the  cer- 
tificate with  intent  to  pass  title.  Reed  vs.  Copeland, 
50  Conn.  472.  But  the  requirements  of  the  by-laws 
must  be  complied  with,  and  where  it  is  provided  by 
by-law  that  the  assignment  must  be  written  in  the 
treasurer's  book  and  subscribed  by  the  assignor  or  his 
attorney,  a  mere  entry  of  credit  on  the  treasurer's 
book  for  the  amount  of  the  stock  is  insufficient  to 
make  the  assignee  a  stockholder  liable  to  assessment. 
Marlborough  Mfg.  Co.  vs.  Smith,  2  Conn.  579.  See 
also  Northrop  vs.  Newtown  &  Bridgeport  Turnpike 
Co.,  3  Conn.  544;  Oxford  Turnpike  Co.  vs.  Bunnell, 
6  Conn.  552. 

The  corporation  books  and  records  determine  who 
are  stockholders  for  the  time  being  and  who  have  a 
right  to  vote  the  stock,  although  the  equitable  title 
may  have  been  sold  or  it  may  have  been  pledged  as 
collateral.  The  person  who  appears  on  the  books  to 
be  the  owner  may  vote  on  the  stock  standing  in  his 
name  and  is  eligible  to  the  office  of  director  as  a 
stockholder.  State,  ex.  rel.  White,  et  al.  vs.  Ferris 
et  als.,  42  Conn.  560. 

Until  a  transfer  of  stock  is  actually  made  on  the 
company's  books  the  legal  title,  and  the  legal  rights 
and  liabilities  of  the  stockholder  of  record  remain 
unchanged  and  a  receiver  may  recover  an  unpaid 
assessment  from  such  stockholder  though  he  has  con- 
tracted with  a  third  person  to  take  the  shares  and 
such  third  person  has  wrongfully  refused.  Russell, 
Receiver,  vs.  Easterbrook,  71  Conn.  50.  And  the 
recording  agent  may  properly  decline  to  permit  a 
transfer  of  its  stock  to  be  made  on  its  books  to  a 
person  who  refuses  to  consent  thereto.     (Ibid.) 


OF  Connecticut  47 

Since  title  can  pass  as  against  third  persons  only 
by  transfer  on  the  books  of  the  company,  an  attach- 
ing creditor  is  not  bound  to  look  beyond  the  books 
to  see  whether  his  debtor  has  made  any  assignment 
of  the  stock  standing  in  his  name.  Dutton  vs.  Con- 
necticut Bank,  13  Conn.  493.  See  also  Colt  vs.  Ives 
et  als.,  31  Conn.  25. 

Since,  however,  the  equitable  title  may  pass  as 
between  the  parties  without  a  transfer  on  the  books, 
a  general  assignment  for  the  benefit  of  creditors  gives 
the  trustee  an  equitable  title  subject  to  the  corporate 
lien  for  the  stockholder's  debt.  Vansands  vs.  Middle- 
sex County  Bank,  26  Conn.  144.  The  beneficial 
owner  of  stock  in  a  Connecticut  corporation  is  not 
precluded,  by  the  mere  fact  that  he  has  permitted  it 
to  stand  in  the  name  of  another  on  the  books  of  the 
corporation,  from  asserting  his  right  thereto  as 
against  an  attaching  creditor,  in  the  absence  of  fraud 
or  grounds  of  estoppel.  N.  Y.  Commercial  Co.  vs. 
Francis  et  al.,  83  Fed.  769. 

Sec.  22.  C2ills  for  meetings ;  changes  in  by-laws. 
All  stockholders*  meetings  shall  be  held  in  this 
state  and,  except  the  first,  at  such  time  and 
place  as  shall  be  provided  in  the  by-laws.  A 
written  or  printed  notice  of  every  such  meeting, 
stating  the  day,  hour,  and  place  thereof,  shall 
be  given  by  the  president  or  secretary  to  each 
stockholder,  by  leaving  such  notice  with  him  or 
at  his  residence  or  usual  place  of  business,  or 
by  mailing  it  to  him  at  his  last  known  post  office 
address,  at  least  five  days  before  such  meeting. 
At  any  such  meeting  by-laws  may  be  adopted, 
or  the  by-laws  previously  adopted  may  be 
altered  or  repealed.  No  by-laws  shall  be 
adopted,    and    no    existing    by-law    shall    be 


48  The  Cokporation  Act 

amended  or  repealed,  unless  written  notice  of 
such  proposed  action  shall  have  been  given  in 
the  call  for  the  meeting  at  which  such  adoption, 
amendment,  or  repeal  is  to  be  acted  upon. 

NOTES. 

For  call  of  first  meeting,  and  waiver,  see  §  67,  iafra, 
page  109. 

To  constitute  a  legal  meeting  the  notice  thereof 
should  show  that  it  was  called  by  the  person  author- 
ized to  issue  the  call,  and  if  called  by  one  who  is  un- 
authorized, though  he  affix  the  names  of  those  author- 
ized to  issue  the  call,  without  previous  authority  or 
subsequent  ratification,  the  meeting  is  illegal.  Bethany 
vs.  Sperry,  10  Conn.  200. 

Where  the  record  states  that  the  meeting  was  called 
for  a  special  purpose  it  will  be  presumed,  until  the 
contrary  is  shown,  that  the  purpose  was  specified  in 
the  call,  and  the  burden  of  proof  is  upon  the  party 
denying  it.  Chase  et  al..  Trustees,  vs.  Tuttle  et  als., 
55  Conn.  455. 

Proof  that  a  letter  containing  a  notice,  properly 
stamped  and  addressed,  has  been  posted,  furnishes 
proper  ground  for  an  inference  that  the  notice  has 
been  given.  Central  National  Bank  vs.  Stoddard,  83 
Conn.  332,  and  this  rule  presumably  would  apply  to 
notice  of  a  meeting. 

Quorum.  Unless  the  by-laws  require  that  a  ma- 
jority, or  some  other  proportion  of  all  the  stock- 
holders, are  necessary  to  constitute  a  quorum,  such  of 
them  as  are  present  will  be  authorized  to  transact  the 
business  for  which  the  meeting  was  properly  called, 
and  the  acts  of  a  majority  of  those  present  will  bind 
the  corporation.  It  is,  of  course,  provided  by  §  25 
that,  in  the  absence  of  a  provision  to  the  contrary  in 
the  charter,  certificate  of  incorporation,  or  statute, 
each  share  of  stock  shall  be  entitled  to  one  vote. 


or  Connecticut  49 

The  ordinary  manner  in  which  stockholders  in  a 
corporation  give  directions  is,  in  the  absence  of  a 
charter  or  statutory  provision  to  the  contrary,  by 
a  vote  of  the  majority  of  the  shares  represented  at  a 
meeting  of  the  corporation  duly  called.  The  Stamford 
Trust  Co.,  Trustee,  vs.  The  Yale  &  Towne  Mfg.  Co. 
et  als.,  83  Conn.  43. 

Alterations  in  the  charter  of  a  corporation  which 
make  a  material  or  fundamental  change  therein  will 
not  become  operative  unless  accepted  or  assented  to 
by  all  the  stockholders.  Those  which  make  auxiliary 
or  incidental  changes  only  will  become  operative  upon 
acceptance  by  a  majority.  The  right  of  the  majority 
to  rule  in  respect  to  charter  changes  of  the  latter  class, 
as  in  all  matters  relating  to  the  corporate  business 
and  policy  within  the  authority  of  the  charter,  is 
implied  in  the  contract  into  which  the  stockholders 
enter.    Perkins  et  als.  vs.  Coffin  et  als.,  84  Conn.  275. 

Sec.  23.     Special  meetings,  how  called ;  waiver. 

The  president  of  every  corporation  may,  and, 
upon  the  written  request  of  three  or  more 
members  of  a  corporation  having  no  capital 
stock,  or  of  one  or  more  stockholders  holding  at 
least  one-tenth  of  the  capital  stock  of  a  corpora- 
tion having  capital  stock,  shall,  call  a  special 
stockholders'  meeting  and  cause  legal  notice 
thereof  to  be  given.  In  case  of  the  neglect  or 
refusal  of  the  president  to  call  a  meeting  on 
such  request,  such  stockholders  may  call  the 
same.  Whenever  under  any  of  the  provisions 
of  this  act  a  corporation  is  authorized  to  take 
any  action  after  notice  to  its  stockholders  or 
after  the  lapse  of  a  prescribed  period  of  time, 
such  action  may  be  taken  without  notice  and 


50  The  Cokpobation  Act 

without  the  lapse  of  any  period  of  time  if  such 
action  be  authorized  and  such  requirements  be 
waived  in  writing  by  every  stockholder  of 
such  corporation  or  by  his  attorney  thereto 
authorized. 

Sec.  24.  Failure  to  hold  meeting  or  elect  officers. 
Whenever  any  corporation  shall  have  failed 
to  hold  its  annual  meeting  or  to  elect  officers 
thereat,  and  no  provision  is  contained  in  its 
charter,  articles  of  association,  certificate  of 
incorporation,  or  by-laws,  or  is  made  by  law, 
otherwise  than  is  provided  in  this  section  for 
such  contingency,  the  officers  of  such  corpora- 
tion shall  hold  office  until  others  shall  be  chosen 
in  their  stead,  and  a  special  or  annual  meeting 
may  be  called  by  the  persons  whose  duty  it  is 
to  call  the  annual  meeting,  or,  on  the  neglect  or 
refusal  of  such  persons,  by  not  less  than  three 
of  the  members  of  a  corporation  having  no 
capital  stock,  or  by  the  holders  of  one-tenth  of 
the  capital  stock  of  corporations  having  capital 
stock,  by  giving  in  writing  such  notice  as  is 
required  in  calling  the  annual  meeting,  and  at 
such  meeting  the  necessary  officers  may  be 
elected,  and  the  failure  aforesaid  shall  not 
impair  the  rights  of  such  corporation.  Nothing 
in  this  section  shall  revive  any  corporation 
whose  powers  may  have  expired  for  any 
cause  other  than  that  hereinbefore  named  or 
any    corporation    which    in    fact    shall    have 


OF  Connecticut  51 

abandoned  and  ceased  to  exercise  its  powers 
and  franchises. 

NOTE. 

Even  before  the  adoption  of  this  statute  it  had 
been  held  in  Connecticut  that  officers  hold  over  until 
their  successors  are  elected.  See  McCall  vs.  Byram 
Mfg.  Co.,  6  Conn.  427,  438 ;  Spencer  vs.  Champion,  9 
Conn.  536,  544;  and  see  N.  Y.,  B.  &  E.  Ry.  Co.  vs. 
Motil,  81  Conn.  466  at  473. 

Sec.  25.  Stockholders'  vote ;  proxies.  At  all 
stockholders'  meetings  stockholders  may  vote 
in  person  or  by  an  attorney  duly  authorized  by 
a  written  power.  Every  share  of  stock  shall 
entitle  the  holder  thereof  to  one  vote  except 
when  otherwise  provided  in  its  charter  or  cer- 
tificate of  incorporation  or  in  any  statute  affect- 
ing it,  and  persons  holding  stock  in  as  amended 
a  fiduciary  capacity  and  pledgors  of  p^bfj^cte  ^'f 
stock  shown  to  be  such  by  the  record  1905,  ch.  171. 
of  transfer  shall  have  the  same  voting  rights 
upon  shares  of  stock  so  held  as  any  holder  of 
such  shares  would  have,  except  that  pledgors  in 
the  transfer  of  stock  may  expressly  empower 
the  pledgees  to  vote  thereon.  No  proxy  here- 
after made  shall  be  valid  after  the  expiration  of 
eleven  months  from  the  date  of  its  execution 
unless  a  longer  term  be  expressly  provided  for 
therein. 

NOTES. 

The  by-laws  should  provide  what  portion  of  the 
stock  must  be  represented  at  a  stockholders'  meeting 


52  The  Cokporation  Act 

to  constitute  a  quorum.  In  the  absence  of  such  pro- 
vision, or  the  absence  of  such  provision  by  statute  or 
by  charter,  such  stockholders  as  are  actually  present 
may  transact  such  business  as  may  properly  come 
before  the  meeting  and  a  majority  vote  of  the  stock 
represented  will  be  binding  on  the  corporation. 

An  agreement  to  transfer  the  voting  power  of  stock 
for  five  years  was  held  invalid  in  the  case  of  Shepaug 
Voting  Trust  Cases,  60  Conn.  553,  decided  by  the 
Superior  Court  in  1890  and  not  taken  to  the  Supreme 
Court. 

Sec.  26.  Receivership  of  corporation.  When- 
ever any  corporation  having  a  capital  stock  has 
wilfully  violated  its  charter  or  exceeded  its 
powers,  or  whenever  there  has  been  any  frand, 
collusion,  or  gross  mismanagement  in  the  con- 
duct or  control  of  such  corporation,  or  when- 
ever its  assets  are  in  danger  of  waste  through 
attachment,  litigation,  or  otherwise,  or  such 
corporation  has  abandoned  its  business  and  has 
neglected  to  wind  up  its  affairs  and  to  distrib- 
ute its  assets  within  a  reasonable  time,  or 
whenever  its  stockholders  or  directors  have 
voted  to  discontinue  its  business,  or  whenever 
any  good  and  sufficient  reason  exists  for  the  dis- 
solution of  such  corporation,  any  stockholder 
or  stockholders  owning  not  less  than  one-tenth 
of  its  capital  stock  or,  in  the  case  of  a  corpora- 
tion not  having  capital  stock,  any  member  of 
such  corporation  may  apply  to  the  superior 
court  in  the  county  wherein  such  corporation  is 
located,  for  the  dissolution  of  such  corporation 
and  the  appointment  of  a  receiver  to  wind  up  its 


OF  Connecticut  53 

affairs.  Such  court  may,  if  it  finds  that  suffi- 
cient cause  exists,  appoint  one  or  more  receivers 
to  wind  up  the  business  of  such  corporation,  and 
may  at  any  time,  for  sufficient  cause  shown, 
make  a  decree  dissolving  such  corporation  and 
terminating  its  corporate  existence.  Whenever 
such  decree  of  dissolution  is  passed,  it  shall  be 
the  duty  of  the  receiver  or  receivers  to  cause  a 
certified  copy  thereof  to  be  filed  in  the  office  of 
the  secretary  of  the  state,  and  said  secretary 
shall  thereupon  record  such  certified  copy  in  a 
book  kept  by  him  for  that  purpose.  Such  court, 
in  every  case  in  which  it  appoints  a  receiver, 
shall  by  its  order  limit  a  time,  which  shall  not 
be  less  than  four  months  from  the  date  of  such 
order,  within  which  all  claims  against  such  cor- 
poration shall  be  presented,  and  all  claims  not 
presented  within  such  time  shall  be  forever 
barred.  When  such  receivership  shall  be  ter- 
minated by  the  court,  the  receiver  or  receivers 
shall  file  with  the  secretary  of  the  state  a  cer- 
tificate similar  to  the  final  certificate  required 
of  directors  in  section  34  of  this  act,  and  said 
secretary  shall  thereupon  record  such  certifi- 
cate in  a  book  kept  by  him  for  that  purpose. 

NOTES. 

General  Statutes  Regarding  Receivership,  Rev.  of 
1902. 

§  1044.     Application  for  receiver;  orders  of  judge. 

When  any  action  shall  he  brought  to,  or  pending  in, 


54  The  Cokpobation  Act 

any  court  of  equitable  jurisdiction,  in  which  an  appli- 
cation shall  he  made  for  the  appointment  of  a  receiver, 
either  judge  of  such  court  or  of  the  superior  court, 
when  such  court  is  not  actually  in  session,  after  due 
notice  given,  may  make  such  order  in  the  premises  as 
the  exigencies  of  the  case  may  require,  and  may  from 
time  to  time  rescind  and  modify  the  same,  and  shall 
cause  his  proceedings  to  he  certified  to  the  court  in 
which  the  action  may  he  pending,  at  its  next  session, 
and  shall  he  entitled  to  receive  for  the  same  the  fees 
allowed  hy  law  for  copies  to  clerks  of  courts. 

§  1045.  Receiver  to  give  bond.  All  receivers,  hefore 
assuming  to  act  as  such,  shall  file  with  the  clerk  of  the 
court  hy  which,  or  hy  a  judge  of  which,  they  are  ap- 
pointed, a  hond  with  such  surety  or  sureties,  and  for 
such  an  amount,  as  such  court  or  judge,  may  order 
and  approve,  payahle  to  the  state,  and  conditioned 
for  the  faithful  performance  of  their  official  duties. 

§  1046.  Authority  of  receiver.  Receivers  of  a  cor- 
poration, appointed  hy  judicial  authority,  shall  have 
the  right  to  the  possession  of  all  its  hooks,  papers,  and 
property,  and  power  in  their  own  names,  or  in  its 
name,  to  commence  and  prosecute  suits  for  and  on 
behalf  of  said  corporation;  to  defend  all  suits  brought 
against  it  or  them;  to  demand  and  receive  all  evi- 
dences of  debt  and  property  belonging  to  it,  and  to 
do  and  execute  in  its  name,  or  in  their  names  as  such 
receivers,  all  other  acts  and  things  which  shall  he 
necessary  or  proper  in  the  execution  of  their  trust; 
and  shall  have  all  the  powers  for  any  of  said  purposes 
possessed  hy  said  corporation.  They  shall,  under  the 
order  of  the  court,  have  the  same  power  as  the  direct- 
ors of  such  corporation  to  call  in  the  subscriptions  to 
its  capital  stock,  in  such  proportions  and  at  such 
times  and  places  as  they  shall  think  necessary  for  the 
purpose  of  paying  all  the  debts  of  said  corporation 
and  all  the  expenses  of  the  receivership. 


OP  Connecticut  55 

§  1047.     Receiver    to   file  semiannual   statements. 

Every  such  receiver  shall,  during  the  first  week  in 
April  and  in  October  in  each  year,  sign,  swear  to,  and 
file  with  the  clerk  of  the  court  hy  which  he  was 
appointed,  a  full  and  detailed  account  of  his  doings 
as  such  receiver  for  the  six  months  next  preceding, 
together  with  a  statement  of  all  orders  of  court  passed 
during  said  six  months  and  the  present  condition  and 
prospects  of  the  estate  in  his  charge,  and  cause  a 
motion  for  a  hearing  and  approval  of  the  same  to  he 
placed  on  the  short  calendar. 

§  1048.  Receiver  of  partnership  when  and  how 
appointed.  When  any  partnership  shall  he  dissolved, 
and  the  partners  cannot  agree  upon  the  disposition  of 
the  partnership  effects  and  the  settlement  of  the 
affairs  of  such  partnership,  either  of  them  may  apply 
to  the  superior  court  for  the  county  in  which  either 
of  said  partners  resides,  or  in  which  the  property  of 
such  partnership  is  situated,  and  in  case  said  court 
is  not  actually  in  session,  then  to  any  judge  of  the 
superior  court,  for  the  appointment  of  a  receiver  to 
hold  the  business  and  all  of  the  estate,  hoth  real  and 
personal,  belonging  to  such  partnership,  and  dispose 
of,  manage,  and  apply  the  same  as  the  said  court  or 
judge  may  direct.  Upon  receiving  such  application 
said  court  or  judge  shall  forthwith  appoint  a  day  for 
the  hearing  upon  the  same,  and  shall  make  such  order 
relative  to  notice  of  such  application  and  of  the  hear- 
ing to  the  other  partners,  as  may  be  deemed  proper, 
provided  the  hearing  shall  he  at  least  six  days  from 
the  service  of  such  order  of  notice;  and  such  court  or 
judge,  upon  said  hearing,  may  appoint  a  receiver  for 
said  partnership,  who  shall  he  subject  to  the  orders 
of  said  court. 

§  1 049 .     Power  of  court  over  the  partnership  property . 

The  said  court,  and  in  vacation  any  judge  thereof, 
shall  have  the  power  to  make  such  orders  relative  to 
the  management  or  closing  up  of  the  business  of  such 


56  The  Corpokation  Act 

partnership,  and  to  the  sale,  division,  or  other  dis- 
posal of  its  real  and  personal  estate,  as  may  he 
necessary  to  protect  the  rights  and  interests  of  each 
partner  and  of  the  creditors  of  such  partnership. 

§  1050.  Receiver  entitled  to  control  of  partnership 
property.  Upon  the  appointment  of  a  receiver  for 
a  partnership,  he  shall  he  entitled  to  the  immediate 
possession  and  control  of  all  of  its  property,  hoth  real 
and  personal,  suhject  to  the  order  of  said  court;  hut 
any  such  appointment,  or  any  order  of  said  court, 
may  he  modified  or  vacated  on  the  application  to  said 
court  of  any  party  to  such  proceedings,  reasonahle 
notice  of  such  application  and  of  the  time  and  place 
of  the  hearing  thereon  having  first  heen  given  to  every 
other  party. 

§  1 05 1.     Receivership  ;  wages  to  be  preferred  claims. 

Every  deht  due  to  any  lahorer  or  mechanic  for  per- 
sonal wages,  from  any  corporation  or  partnership  for 
which  a  receiver  shall  he  appointed,  for  any  lahor  per- 
formed for  such  corporation  or  partnership  within 
three  months  next  preceding  the  service  of  the  appli- 
cation for  the  appointment  of  a  receiver,  shall  he  paid 
in  full  hy  the  receiver,  to  the  amount  of  one  hundred 
dollars,  hefore  the  general  liahilities  of  such  corpora- 
tion or  partnership  are  paid. 

§  1052.  Court  may  remove  receiver  at  pleasure,  and 
fill  vacancy.  Receivers  may  he  removed  at  any  time, 
at  the  pleasure  of  the  court  hy  which  they  were  ap- 
pointed, or,  if  such  court  is  not  actually  in  session,  hy 
a  judge  thereof;  and  if  any  receiver  is  removed,  or 
declines  to  act,  or  dies,  the  court  that  appointed  him, 
or,  if  such  court  is  not  actually  in  session,  a  judge 
thereof,  may  fill  the  vacancy. 

§1053.  Receivership;  dissolution  of  attachment; 
costs.  The  commencement  of  proceedings  for  the 
appointment  of  a  receiver  of  a  corporation  or  a  part- 
nership shall  dissolve  all  attachments,  and  all  levies 


OF  Connecticut  57 

of  executions  not  completed,  made  within  sixty  days 
next  preceding,  on  the  property  of  such  corporation 
or  partnership;  hut  if  the  property  is  subsequently 
taken  from  the  receiver,  so  that  it  cannot  he  made 
subject  to  the  orders  of  the  court  in  the  settlement  of 
the  affairs  of  said  corporation  or  partnership,  or  if 
the  receivership  shall  be  terminated  by  order  of  the 
court  pending  the  settlement  of  the  affairs  of  the  cor- 
poration or  partnership,  said  attachments  and  levies 
of  execution  shall  revive,  and  the  time  from  the  com- 
mencement of  such  proceedings  to  the  time  when  the 
receiver  shall  be  dispossessed  of  the  property,  or  the 
finding  of  the  court  that  said  property  is  not  subject 
to  the  orders  of  said  court,  or  when  said  trust  shall 
be  terminated,  shall  be  excluded  from  the  computation 
in  determining  the  continuance  of  the  lien  created  by 
such  attachment;  but  the  attaching  or  levying  credi- 
tors shall  be  allowed  the  amount  of  their  legal  costs, 
accruing  before  the  time  of  the  appointment  of  a 
receiver,  as  a  preferred  claim  against  the  estate  of 
said  corporation  or  partnership,  if  their  respective 
claims  upon  which  the  attachments  are  founded  shall, 
in  whole  or  in  part,  be  allowed. 

Under  Rules  of  Court,  Practice  Book,  1908,  are  the 
following  provisions  concerning  Receivers. 

10. 
Receivers. 

Sec.  50.  All  applications  for  the  appointment  of 
a  receiver  shall  be  made  in  a  civil  action.  As  ancillary 
thereto  an  application  may  be  made,  when  the  court 
before  which  such  action  is  pending  is  not  in  actual 
session,  to  a  judge  in  chambers  for  the  appointment 
of  a  temporary  receiver,  and  said  judge  may  appoint 
such  temporary  receiver  with  or  without  notice  to 
the  parties  in  interest  as  he  may  deem  advisable,  and 
upon  such  appointment  said  judge  shall  fix  a  time 


58  The  Cokporation  Act 

for  a  hearing  upon  the  confirmation  of  such  tem- 
porary receiver  and  the  appointment  of  two  apprais- 
ers, and  cause  not  less  than  six  days'  notice  thereof 
to  be  given  all  parties  in  interest  by  mail  and  other- 
wise, if  deemed  necessary,  and  upon  such  hearing  he 
may  appoint  such  two  appraisers  and  confirm  such 
temporary  receiver,  or  make  a  new  appointment  of  a 
temporary  receiver.  The  appointment  of  such  tem- 
porary receiver  shall  continue  until  the  permanent 
receiver  shall  be  appointed,  or  the  further  order  of 
the  court. 

The  temporary  receiver  shall  cause  said  "application 
to  be  duly  assigned  for  trial  in  court  at  the  earliest 
practicable  day  after  the  return  day  of  the  action  for 
the  appointment  of  a  permanent  receiver,  and  in  cases 
where  the  day  for  such  hearing  has  not  been  fixed 
before  the  opening  of  the  session  of  the  court  to  which 
said  proceeding  is  returnable,  the  temporary  receiver, 
on  or  before  such  opening,  shall  make  and  place  upon 
the  short  calendar  list  an  application  therefor. 

Judges  shall  certify  all  orders  passed  by  them  in 
chambers  to  the  court  in  which  the  action  may  be 
pending. 

Sec.  51.  All  appointments  of  receivers  shall  be 
temporary  appointments,  Unless  made  by  the  court 
after  the  return  day  of  the  cause,  and  upon  full 
notice  and  opportunity  to  be  heard  to  all  concerned. 
If  made  after  the  return  day  it  shall  be  upon  written 
motion  addressed  to  the  court.  If  made  before  the 
return  day,  the  party  desiring  the  appointment  shall 
file  a  written  application  as  is  required  where  the 
appointment  is  by  a  judge  in  chambers.  In  either 
case  the  court  making  a  temporary  appointment  shall 
forthwith  make  an  order  for  a  hearing  upon  the  con- 
firmation of  such  temporary  appointment  and  the 
appointment  of  two  appraisers,  and  direct  the  tem- 
porary receiver  to  give  notice  of  such  hearing  and  of 
the  time  and  place  thereof  to  all  parties  concerned  by 
such  public  advertisement  if  it  seem  advisable,  and 


OF  Connecticut  59 

by  causing  a  written  or  printed  notice  thereof  to  be 
mailed,  postpaid,  to  all  known  creditors  and  to  all 
stockholders  of  record  of  the  corporation,  if  defendant 
be  a  corporation,  at  least  six  days  before  such  hear- 
ing. At  said  hearing,  if  after  the  return  day,  the 
court  may  appoint  a  permanent  receiver,  who  may  be 
either  the  temporary  receiver  or  a  new  appointee. 
If  said  hearing  is  before  the  return  day,  then  such 
appointment  shall  be  temporary  only,  and  such 
temporary  receiver  shall  cause  the  matter  of  his 
confirmation  as  permanent  receiver  or  the  appoint- 
ment of  some  other  person  as  permanent  receiver  to 
be  brought  before  the  court  as  provided  in  the  case 
of  temporary  receivers  appointed  by  a  judge  in 
chambers. 

Cogswell  vs.  Second  National  Bank,  76  Conn.  257. 

Sec.  52.  The  condition  of  bonds  of  temporary 
receivers  shall  be  in  substantially  the  following  form : 

''The   condition  of   this   obligation   is   such   that, 
whereas,  the  above  named  A.  B.  has  by 
been  appointed,  in  an  action  brought  by  X  against  Y, 
to  be  temporary  receiver  of 

''Now,  therefore,  if  the  said  A.  B.  shall  well  and 
truly  perform  his  duties  under  such  appointment, 
and  in  the  event  that  he  shall  hereafter,  at  any  time 
or  times,  be  confirmed  or  appointed  in  said  action, 
either  as  temporary  or  permanent  receiver  of  said 
,  his  duties  as  such  receiver,  then  this 
obligation  shall  be  void,  otherwise  in  full  force  and 
effect." 

State  vs.  Spittler  et  als.,  79  Conn.  470. 

Sec.  53.  Receivers,  upon  their  confirmation  or 
permanent  appointment,  shall  forthwith  and  without 
any  order  therefor  prepare  and  file  a  sworn  inven- 
tory of  the  assets  of  the  estate,  which  inventory  shall 
contain  an  appraisal  of  the  items  thereof,  made  by 
the  appraisers  appointed  as  aforesaid.     Temporary 


60  The  Cobpokation  Act 

receivers,  upon  their  original  appointment,  shall  make 
an  inventory,  unless  otherwise  ordered. 

Sec.  54.  At  the  hearings  provided  for  in  §§50 
and  51,  or  at  some  subsequent  time,  an  order  shall 
be  made  limiting  a  time  for  the  presentation  of  claims 
against  the  estate  and  directing  that  the  receiver 
forthwith  give  notice  thereof,  and  that  all  claims  not 
exhibited  within  said  time  will  be  barred,  to  all  known 
creditors,  by  mailing  to  them  a  written  or  printed 
copy  of  such  order;  and  the  court  may  provide  for 
further  notice  if  it  deem  the  same  reasonable. 

Sec.  55.  The  receiver  shall  within  two  weeks 
thereafter  make  a  return  of  his  compliance  with  such 
order,  and  within  a  like  time  after  the  expiration  of 
the  limitation  file  a  list  of  claims  presented,  and  make 
application  for  the  order  of  the  court  thereon. 

The  court  shall  thereupon  by  its  order  allow  or  dis- 
allow in  whole,  or  in  part,  the  claims  so  returned,  and 
order  the  receiver  forthwith  to  give  written  notice  to 
each  claimant  whose  claim  has  been  disallowed  in 
whole  or  in  part  that  unless  such  claimant  shall 
within  two  weeks  from  the  giving  of  such  notice  by 
the  receiver  bring  an  application  to  the  court  for  the 
allowance  of  his  said  claim  the  same  shall  be  barred; 
and  any  such  application  shall  be  speedily  heard  and 
the  decision  thereon  shall,  subject  to  appeal,  be  final. 

Any  creditor  may  intervene  in  said  proceeding. 

The  court,  for  good  cause  shown,  may  extend  the 
time  for  presenting  a  claim  or  claims  to  the  receiver, 
and  may  extend  the  time  for  making  application  for 
the  allowance  of  a  claim  or  claims  disallowed  in  whole 
or  in  part. 

The  court  may,  upon  due  notice  to  a  claimant,  hear 
his  claim  before  allowing  or  disallowing  the  same  and, 
subject  to  appeal,  the  decision  thereon  shall  be  final. 

Sec.  56.  No  order  for  the  continuance  of  a  busi- 
ness shall,  unless  for  special  cause  shown,  be  made  for 
a  greater  period  of  time  than  four  months.    For  cause 


OF  Connecticut  61 

shown,  such  orders  may  be  renewed  from  time  to  time, 
as  the  exigencies  of  the  case  may  require. 

Sec.  57.  When  a  receiver  is  continuing  business 
under  the  order  of  a  judge  or  the  court,  he  shall, 
during  the  first  ten  days  of  each  month  of  such  con- 
tinuance, file  an  account  showing  the  results  of  the 
business  during  the  preceding  month,  and,  if  such 
account  shows  that  the  business  has  been  run  at  a 
loss,  cause  such  account  to  be  brought  to  the  attention 
of  the  court,  or,  if  it  is  not  in  session,  of  said  judge, 
or,  if  the  latter  cannot  give  it  his  attention,  to  that 
of  the  court  when  next  in  session. 

Sec.  58.  Every  receiver  shall,  on  the  first  Tues- 
days of  October  and  April  of  each  year,  file  a  sum- 
mary statement  of  all  orders  made  in  said  cause  dur- 
ing the  six  months  preceding,  and  the  doings  there- 
under. The  clerk  shall  hand  said  summaries  to  the 
judge  holding  the  term  or  session  then  pending,  or 
next  thereafter,  who  shall,  upon  examination  of  the 
same,  make  such  further  orders  in  said  cause  as  are 
deemed  by  him  necessary,  and  may  direct  that  the 
cause  be  placed  on  the  short  calendar,  for  an  order 
approving  the  statement. 

Sec.  59.  Every  receiver  upon  an  estate  which  has 
been  in  process  of  settlement  more  than  four  months 
shall,  on  the  first  Tuesdays  of  October  and  April  of 
each  year,  file  with  the  court  a  full  and  detailed 
account  of  the  condition  and  prospects  of  the  estate, 
including  therein,  (a)  a  full  list  of  all  the  assets  on 
hand  with  the  appraisal  value  and  the  present  value 
as  estimated  by  the  receiver  in  parallel  columns, 
(b)  a  particular  statement  of  the  disposition  made 
of  all  assets  since  the  last  report,  together  with  a 
statement  in  parallel  columns  of  the  appraisal  value 
and  the  amount  realized  therefor,  (c)  a  statement  of 
all  receipts  with  the  present  balance  on  hand  and  of 
all  disbursements  since  the  last  semiannual  report, 
together  with  the  cash  on  hand,  the  places  and  terms 


62  The  Cokporation  Act 

of  deposit,  and  cause  a  motion  for  the  approval  of 
the  same  to  be  placed  on  the  short  calendar. 

In  all  instances  the  reasons  for  delay  in  con- 
verting the  assets  into  cash,  and  for  failure  to  realize 
appraised  values  shall  be  given  in  said  account. 

Sec.  60.  Whenever  any  judge  in  vacation  has 
appointed  a  receiver,  all  applications  for  orders  in 
said  proceeding  made  out  of  court  shall,  except  in  the 
case  of  such  judge's  absence  from  the  State,  disability, 
or  request  in  writing  to  the  contrary,  be  made  to  him. 

Sec.  61.  The  clerks  shall  see  that  these  rules  are 
enforced  and  promptly  report  any  violations  thereof 
to  the  court. 

Sec.  62.  The  course  of  conduct  prescribed  by 
these  rules  may  be  altered  or  varied  at  any  time  by 
an  order  of  the  court  or  judge  having  jurisdiction  of 
a  receivership  proceeding. 

As  to  Receivership  of  Corporations  having  property 
upon  which  its  members  are  dependent  for  support, 

it  is  provided  by  the  Public  Acts  of  1905,   Chap. 
206,  as  follows: 

"Section  1.  Whenever  there  shall  he  in  any  town 
an  association,  community,  or  corporation  organized 
in  whole  or  in  part  for  the  support  of  its  members,  and 
having  property  upon  which  its  members,  in  whole  or 
in  party  are  dependent  for  their  support,  if,  in  the 
opinion  of  the  selectmen  of  said  town,  there  he  danger 
that  such  property  he  lost  or  expended  in  any  manner 
so  that  some  of  such  members  shall  become  an  expense 
to  the  town,  said  selectmen  may  bring  an  application, 
in  the  name  of  the  town,  to  the  superior  court  in  the 
county  in  which  said  town  is  situated,  for  the  appoint- 
ment of  a  receiver  of  the  property  of  said  association, 
community,  or  corporation,  and  for  other  equitable 
relief;  and  said  court  shall  have  power,  if  it  shall 
deem  necessary  and  proper,  to  appoint  a  receiver  of 
all  the  property  of  said  association,  community,  or 


OF  Connecticut  63 

corporation,  and  vest  all  said  property  in  such 
receiver,  by  decree  or  otherwise,  to  provide  that  said 
property  shall  he  managed  and  used  for  the  benefit 
and  support  of  such  members,  in  such  manner  as  said 
court  shall  find  to  be  best  for  the  proper  protection 
of  such  town  and  such  members,  and  to  grant  such 
other  relief  as  shall  be  necessary  for  that  purpose  and 
to  protect  the  interests  of  said  town  and  said  members, 
according  to  the  practice  and  proceedings  of  courts 
of  equity. 

''Sec.  2.  No  application  shall  be  brought  under 
the  preceding  section  of  this  act  by  the  selectmen 
until  the  matter  has  been  submitted  to  the  town  at 
a  special  meeting  called  for  that  purpose  and  until 
the  town  has  approved  of  said  application  by  vote 
at  said  meeting." 

NOTES. 

It  is  only  under  exceptional  circumstances  that  the 
principal  manager  of  an  insolvent  corporation  can 
with  propriety  be  appointed  its  receiver,  and  never 
when  his  personal  interests  may  conflict  with  those 
of  the  creditors.  In  re  Premier  Cycle  Co.,  70  Conn. 
473. 

A  receiver  has  no  vested  right  of  office  but  may  be 
removed  at  any  time  by  the  court  on  due  notice. 
From  an  order  of  removal  he  has  no  right  of  appeal 
either  as  receiver  or  in  his  personal  capacity.  In  re 
Premier  Cycle  Co.,  70  Conn.  473.  He  may,  however, 
appeal  in  his  personal  capacity  from  an  order  which 
determines  that  after  his  discharge  from  office  he  will 
be  personally  responsible  for  obligations  which  he 
contracted  officially.  Hinckley  vs.  Oilman,  94  U.  S. 
467. 

A  nonresident  must  renounce  inconsistent  rights 
obtained  in  another  jurisdiction  after  notice  of  a 
receivership  in  this  state  before  proving  his  claim  in 
receivership  proceedings  here,  but  he  does  not  forfeit 


64  The  Corpoeation  Act 

his  right  to  present  a  balance  of  his  claim  here  by- 
causing  to  be  sold  on  execution  personal  property  in 
another  State  attached  before  the  receivership  here. 
Ward  et  al.  vs.  The  Connecticut  Pipe  Mfg.  Co.,  71 
Conn.  345. 

Gen.  St.,  Rev.  of  1902,  §  1053,  providing  for  dis- 
solution of  all  attachments  made  within  sixty  days 
next  preceding  a  receivership,  does  not  apply  to 
attachments  made  in  another  State.  Ward  et  al.  vs. 
The  Connecticut  Pipe  Mfg.  Co.,  71  Conn.  345. 

The  mere  fact  that  the  business  of  a  trading  cor- 
poration has  been  run  at  a  loss  since  its  organization 
three  or  four  years  before  does  not  necessarily,  as 
matter  of  law,  call  for  its  dissolution  and  the  appoint- 
ment of  a  receiver,  the  court  having  a  large  measure 
of  judicial  discretion  as  to  what  is  the  best  course,  on 
the  whole,  to  pursue.  Ray  vs.  The  Robert  Price  Coal 
Company  et  als.,  80  Conn.  558. 

Bankruptcy  proceedings  in  the  Federal  Court  do 
not  prevent  the  dissolution  of  a  corporation  by  a 
State  court,  and  the  State  court  can  dissolve  a  cor- 
poration here  though  it  also  holds  a  franchise  from 
other  states,  since  the  decree  of  dissolution  here 
affects  only  the  franchise  conferred  by  this  State. 
Hart  vs.  Boston,  H.  &  E.  R.  R.,  40  Conn.  524. 

The  appointment  of  a  receiver  under  §  26  may  con- 
stitute an  act  of  bankruptcy  under  the  Federal  bank- 
ruptcy laws  where  the  record  and  findings  in  the 
state  court  show  that  the  appointment  was  in  fact, 
though  not  in  name,  made  ''because  of  insolvency." 
In  re  Belfast  Mesh  Underwear  Co.,  153  Fed.  224. 

Property  in  the  hands  of  a  receiver  is  so  far  under 
the  direction  and  control  of  the  court  that  the  court 
may  even  direct  the  receiver  what  wages  shall  be  paid 
to  employees.  Guarantee  Trust  and  Safe  Deposit  Co. 
vs.  P.,  R.  &  N.  E.  Railroad  Co.,  69  Conn.  709. 

The  appointment  of  a  receiver  does  not  ipso  facto 
dissolve  the  corporation.  The  shares  of  stock  may 
still  be  transferred  freely,  and  the  stockholders  may 
meet  and  take  any  action  not  inconsistent  with  the 


OF  Connecticut  65 

relations  incident  to  the  existence  of  the  receivership. 
Butler,  Receiver,  vs.  Beach,  82  Conn.  417. 

A  judgment  dissolving  a  corporation  upon  pro- 
ceedings instituted  by  certain  of  its  stockholders  is 
final  as  to  all  persons  interested  who  have  notice  and 
an  opportunity  to  appear  and  object;  and  therefore 
an  appeal  from  such  a  judgment  must  be  taken  within 
the  time  prescribed  by  statute,  and  cannot  be  deferred 
until  after  the  rendition  of  an  order  distributing  the 
assets  and  discharging  the  receiver.  Ensworth  et  als. 
vs.  National  Life  Association,  81  Conn.  592. 


Sec.  27.  Sale  of  property  and  franchises.  Said 
court  may,  in  its  discretion,  in  lieu  of  decreeing 
the  dissolution  of  such  corporation,  order  the 
receiver  to  sell  its  property  and  franchises ;  and 
the  purchaser  thereof  shall  succeed  to  all  of  the 
rights  and  privileges  of  such  corporation,  and 
may  reorganize  the  same  under  the  direction  of 
said  court.  At  any  sale  of  such  property  at 
public  auction,  the  court  may,  in  its  discretion, 
authorize  the  receiver  to  accept  in  payment 
duly  allowed  claims  against  such  corporation, 
at  a  proper  valuation. 

Sec.  28.  Appraisal  and  purchase  of  minority 
stock  interest.  Whenever  a  stockholder  or 
stockholders  holding  not  less  than  one-tenth  of 
the  whole  amount  of  the  capital  stock  of  any 
corporation  shall  petition  for  its  dissolution 
and  the  appointment  of  a  receiver,  pursuant  to 
section  26  of  this  act,  any  other  stockholder  or 
stockholders  may  apply  to   said  court  for  a 


66  The  Cokporation  Act 

valuation  of  the  stock  held  by  the  petitioner  by 
an  appraiser  to  be  appointed  by  the  court.  Said 
court  may,  for  sufficient  cause  shown,  appoint 
one  or  more  persons  to  appraise  such  stock, 
who  shall  forthwith  hear  the  parties  interested, 
determine  the  value  of  the  petitioner's  stock, 
and  file  the  appraisal  with  the  clerk  of  said 
court.  Said  clerk  shall  at  once  give  written 
notice  to  the  parties  interested  that  such 
appraisal  has  been  filed,  and,  within  ten  days 
after  the  giving  of  such  notice,  the  applicant 
for  an  appraisal  shall  file  with  said  clerk  a 
writing  stating  whether  he  elects  to  buy  the 
petitioner's  stock  at  the  appraisal,  and,  if  he 
does  elect  to  buy  it,  he  shall  at  the  same  time 
deposit  the  amount  of  such  appraisal  in  money, 
or  certified  check,  with  said  clerk,  who  shall 
forthwith  notify  the  petitioner  of  the  filing  of 
such  election  and  of  the  deposit.  If  such 
deposit  is  made  as  provided  herein,  said  peti- 
tion for  a  dissolution  of  the  corporation  and 
the  appointment  of  a  receiver  shall  be  dismissed 
upon  motion  of  such  depositor.  Such  deposit 
shall  be  paid  over  to  the  petitioner  by  the  clerk, 
on  receipt  of  the  certificates  of  his  stock  duly 
indorsed  for  transfer,  to  be  delivered  to  the 
depositor.  If  such  certificates  are  not  so  in- 
dorsed and  received  within  thirty  days  from  the 
time  of  such  deposit,  the  money  or  check  shall 
be  returned  to  the  depositor.  If  the  applicant 
for  appraisal  shall  fail  to  make  such  deposit, 


OF  Connecticut  67 

said  action  may  proceed  to  final  judgment.  The 
expenses  of  the  appraisal  shall  be  taxed  by  the 
court,  and  shall  be  paid  by  the  stockholders 
applying  for  such  appraisal,  if  they  fail  to 
deposit  the  amount  of  the  appraisal  required  as 
aforesaid,  but  otherwise  shall  be  taxed  against 
the  corporation  and  added  to  the  final  costs  in 
the  case. 

Sec.  29.  Voluntary  dissolution  after  commencing 
business.  Whenever  the  directors  of  a  cor- 
poration shall  vote  to  terminate  its  corporate 
existence,  they  shall  forthwith  call  a  special 
meeting  of  the  stockholders,  to  be  held  not  less 
than  thirty  nor  more  than  forty  days  from  the 
date  of  such  call.  Such  call  shall  contain  a  copy 
of  such  vote  and  shall  be  published  once  a  week 
for  four  weeks  next  preceding  such  meeting,  in 
a  newspaper  of  this  state  having  a  circulation  in 
the  town  where  such  corporation  is  located,  and 
a  copy  thereof  shall  be  sent  by  mail  to  the  last 
known  address  of  each  stockholder.  If,  at  such 
meeting  of  the  stockholders,  three-fourths  in 
interest  of  each  class  of  stock  issued  shall  vote 
to  confirm  such  vote  of  the  directors,  the  direct- 
ors shall  proceed  forthwith  to  wind  up  the 
affairs  of  such  corporation.  If  every  stock- 
holder shall  sign  and  acknowledge,  before  an 
officer  authorized  to  take  acknowledgments  of 
deeds,  an  agreement  among  stockholders  that 
the   corporate   existence   of   such   corporation 


68  The  Cokporation  Act 

shall  be  terminated,  the  vote  of  the  directors 
and  the  confirming  vote  of  the  stockholders 
aforesaid  may  be  dispensed  with. 

NOTE. 

For  voluntary  dissolution  of  Corporations  without 
capital  stock,  see  Public  Acts  of  1907,  Chap.  165, 
infra,  page  132. 

Sec.  30.  Directors  trustees  to  wind  up  business. 
The  directors  of  a  corporation  whose  existence 
is  to  be  terminated  pursuant  to  the  vote  or 
assent  of  its  stockholders,  as  provided  in  section 
29  of  this  act,  shall  be  trustees  to  close  up  the 
business  of  such  corporation.  They  shall  forth- 
with prepare  an  inventory  of  its  assets,  make  a 
list  of  its  creditors  with  the  amounts  due  to 
each,  and  collect  its  bills  and  accounts  receiv- 
able. They  shall,  within  two  weeks  after  the 
date  of  the  stockholders'  vote  of  confirmation 
or  agreement  to  dissolve  the  corporation,  send 
a  written  notice  of  the  proposed  dissolution  to 
every  known  creditor  of  such  corporation  warn- 
ing him  to  present  his  claim  and  stating  to 
whom  and  at  what  place  such  claim  may  be 
presented.  They  shall  in  such  notice  limit  the 
time  within  which  such  claims  shall  be  pre- 
sented, which  shall  not  be  less  than  four  months 
after  the  date  of  such  stockholders'  vote  or 
agreement.  They  shall  also  publish,  in  some 
newspaper  published  in  this  state  and  having  a 
circulation  in  the  town  where  such  corporation 


OF  Connecticut  69 

is  located,  a  copy  of  such  notice.  Within  one 
year  from  the  date  of  such  stockholders^  vote 
or  agreement  the  trustees  shall  sell  all  of  the 
property  of  such  corporation  except  money  and 
uncollected  accounts  in  litigation,  at  private 
sale  or  public  auction.  As  soon  as  practicable, 
the  trustees  shall  pay,  in  full  or  pro  rata,  all 
claims  against  such  corporation  which  have 
been  allowed  by  them  or  which  may  be  found 
to  be  due  by  any  proper  tribunal  and  shall 
distribute  the  balance  of  the  assets,  if  any, 
among  the  stockholders  of  such  corporation. 

NOTE. 

A  provision  in  a  general  act  for  the  organization 
of  corporations  that  a  corporation  organized  under 
it  may  authorize  its  own  dissolution  and  the  disposi- 
tion of  its  property  thereafter,  does  not  authorize 
such  a  corporation  continuing  in  existence  to  dispose 
of  all  its  corporate  franchises  and  powers  by  lease. 
Oregon  Ry.  &  Nav.  Co.  vs.  Oregonian  Ry.  Co.,  130 
U.  S.  1. 

Sec.  31.  Application  to  the  court.  Such 
trustees  may,  in  their  discretion,  bring  their 
application  to  the  superior  court  for  the  county 
mthin  which  such  corporation  is  located,  or  to 
any  judge  of  the  superior  court  when  such 
court  is  not  in  session,  setting  forth  the  facts  of 
such  proposed  dissolution  and  praying  the 
court,  or  such  judge,  to  limit  a  period  within 
which  all  claims  against  such  corporation  must 
be  presented,  and  such  court  or  judge  may  make 


70  The  Cokpokation  Act 

an  order  limiting  the  time  within  which  claims 
must  be  presented,  which  shall  not  be  less  than 
four  months  from  the  date  of  such  order.  Such 
trustees  shall  proceed  to  wind  up  the  affairs  of 
the  corporation,  in  accordance  with  the  provi- 
sions of  section  30  of  this  act,  under  the 
direction  of  the  court  in  the  same  manner  as 
if  they  were  receivers.  The  court  may,  for 
cause  shown,  extend  the  period  within  which 
the  trustees  shall  sell  the  property  of  the 
corporation. 


NOTE. 

The  title  which  a  trustee  acquires  to  the  property 
of  a  debtor,  as  well  as  his  powers  and  duties  in  ad- 
ministering the  estate  are  the  same  whether  the  assign- 
ment is  voluntary  or  compulsory.  Newtown  Savings 
Bank  vs.  Lawrence  et  al.,  71  Conn.  358.  See  also 
Bunnell,  Trustee,  vs.  Bronson,  Trustee,  78  Conn.  679 ; 
Wilson,  Trustee,  vs.  Griswold,  79  Conn.  18. 


Sec.  32.     When    claims    shall    be    barred.    All 

claims  not  presented  within  the  time  limit  in 
accordance  with  the  provisions  of  sections  30 
and  31  of  this  act  shall  be  barred  and  any 
claim  so  presented  and  disallowed  by  such 
trustees  shall  be  barred  unless  the  owner 
thereof  shall  commence  an  action  to  enforce 
the  same  within  four  months  after  such  trustees 
shall  have  given  him  written  notice  of  its 
rejection. 


OF  Connecticut  71 

Sec.  33.  Creditors  not  to  interfere  with  control 
of  property.  No  creditors  shall,  by  attachment 
or  by  any  process  or  proceeding,  interfere  with 
the  custody,  control,  or  disposition  of  the  prop- 
erty of  the  corporation  by  its  directors  acting 
as  trustees  for  the  winding  up  of  the  corporate 
affairs  under  the  provisions  of  this  act.  But 
any  creditor,  pending  such  winding  up,  may 
apply  to  the  superior  court  in  the  county  in 
which  the  corporation  is  located,  or  to  a  judge 
thereof  when  such  court  is  not  actually  in  ses- 
sion, for  the  appointment  of  a  receiver  of  such 
property  on  the  ground  of  fraud,  mismanage- 
ment, or  incompetency  of  such  trustees,  and 
such  court  or  judge,  upon  finding  that  such 
trustees  are  incompetent  or  have  been  guilty  of 
fraud  or  mismanagement  in  the  discharge  of 
their  duties,  shall  appoint  such  receiver  and  the 
powers  of  such  trustees  shall  thereupon  ter- 
minate. But  nothing  herein  contained  shall 
prevent  any  person  from  establishing  any  claim 
against  such  corporation  by  an  action  at  law, 
or  shall  prevent  the  foreclosure  of  any  lien  or 
mortgage  existing  at  the  time  of  such  vote  or 
assent  to  dissolve. 

Sec.  34.     Certificates  concerning  dissolution. 

Whenever  the  stockholders  shall  by  vote  or 
written  assent  agree  to  the  dissolution  of  a  cor- 
poration, a  majority  of  the  directors  shall  make, 
sign,  and  swear  to  and  file  in  the  office  of  the 


72  The  Corpokation  Act 

secretary  of  the  state  a  certificate  that  such 
stockholders '  vote  has  been  duly  passed  or  such 
assent  duly  given,  and  stating  the  address  to 
which  all  claims  against  such  corporation  may 
be  sent,  and  such  secretary  shall  thereupon 
record  such  certificate  in  a  book  kept  by  him  for 
that  purpose.  When  the  directors  have  com- 
pleted their  duties  as  trustees  as  aforesaid,  a 
majority  of  them  shall  make,  sign,  and  swear  to 
and  file  in  the  office  of  the  secretary  of  the  state 
a  further  certificate  stating  that  the  directors 
have  completed  their  duties  in  winding  up  the 
affairs  of  such  corporation  and  have  sold  or 
collected  all  of  its  assets  and  distributed  the 
same,  stating  the  manner  of  such  distribution. 
The  secretary  shall  examine  the  same,  and,  if 
he  finds  that  it  conforms  to  law,  shall  indorse 
thereon  the  word  *^ Approved,''  with  his  name 
and  official  title,  and  shall  thereupon  record 
such  certificate  in  a  book  kept  by  him  for  that 
purpose.  When  such  certificate  has  been 
approved  by  the  secretary,  the  existence  of  such 
corporation  shall  terminate. 

NOTES.  - 

Special  Provision  Relating  to  Dissolution  of  Old 
Corporation,  Public  Acts  of  1905,  Chap.  121. 

*' Section  1.  In  all  cases  where  any  corporation, 
organized  prior  to  August  1,  1901,  had,  before  that 
date,  voted  to  discontinue  its  business  and  distribute 
its  capital  stock  among  its  stockholders,  in  accord- 
ance with  the  provisions  of  section  1943  of  the  general 


OF  Connecticut  73 

statutes,  revision  of  1888,  and  has  heretofore  applied 
to  and  obtained  from  the  superior  court  in  the  county 
in  which  it  is  located,  or  a  judge  of  said  court  in  vaca- 
tion, an  order  limiting  a  time  not  less  than  two  months 
from  the  date  of  such  order  for  the  creditors  of  such 
corporation  to  present  their  claims  against  it  to  its 
directors,  as  in  said  statute  provided,  the  directors  of 
such  corporation,  or  a  majority  of  them,  may  make, 
sign  and  swear  to,  and  file  in  the  office  of  the  secre- 
tary of  the  state  a  certificate  stating  that  the  direct- 
ors have  completed  their  duties  in  winding  up  the 
affairs  of  such  corporation,  have  sold  and  collected 
all  its  assets,  paid  and  satisfied  all  claims  presented 
to  them  against  said  corporation,  and  distributed  the 
assets  remaining  in  their  hands  to  and  among  the 
parties  entitled  to  the  same.  The  secretary  of  the 
state  shall  examine  said  certificate,  and  if  he  finds 
that  it  conforms  to  the  provisions  of  this  act  shall 
indorse  thereon  the  word  'Approved'  with  his  name 
and  official  title,  and  shall  thereupon  record  such  cer- 
tificate in  a  book  kept  by  him  for  that  purpose.  When 
such  certificate  has  been  approved  by  the  secretary 
of  the  state  the  existence  of  such  corporation  shall 
terminate. 

*'Sec.    2.      This    act    shall    take    effect    from    its 
passage. 


ff 


Sec.  35.  Certificate  when  corporate  existence 
ends  by  limitation.  When  the  existence  of  a  cor- 
poration terminates  by  limitation,  a  majority 
of  the  directors  shall  make,  sign,  and  swear  to 
and  file  in  the  office  of  the  secretary  of  the  state 
a  certificate  setting  forth  the  facts  as  to  such 
termination  and  stating  the  manner  in  which 
its  affairs  are  to  be  wound  up  and  the  name  and 
address  of  the  person  to  whom  claims  may  be 


74  The  Cobporation  Act 

presented  by  creditors  of  such  corporation. 
The  secretary  shall  thereupon  record  the  same 
in  a  book  kept  by  him  for  that  purpose. 

Sec.  36.  Corporate  existence  to  be  continued  for 
certain  purposes.  All  corporations,  whether 
they  expire  by  their  own  limitation  or  are  dis- 
solved by  voluntary  action,  by  decree  of  court, 
or  by  act  of  the  general  assembly,  shall  con- 
tinue so  far  as  may  be  necessary  to  enable  them 
to  prosecute  and  defend  suits  by  or  against 
them,  to  close  up  their  affairs,  dispose  of  their 
property,  and  distribute  their  assets. 

NOTES. 

A  court  of  equity,  at  the  suit  of  creditors  of  an 
insolvent  corporation  whose  existence  is  continued 
by  statute  for  the  purpose  of  collecting  its  debts  and 
closing  up  its  affairs,  may  by  its  decree  direct  an 
assessment  for  the  benefit  of  creditors,  which  will 
bind  stockholders  not  individually  parties  to  the  suit. 
Glenn  vs.  Liggett,  135  U.  S.  533. 

Though  decrees  of  court  have  annulled  the  charter 
of  a  corporation  and  discharged  the  receiver,  it  is 
still  within  the  power  of  the  courts  to  revive  it  and 
thereby  enable  it  to  sue  upon  an  obligation  due  and 
payable  to  it.  Parsons  vs.  Utica  Cement  Mfg.  Co., 
82  Conn.  333. 

Sec.  37.  Annual  Reports.  The  president  and 
treasurer  of  every  corporation  having  capital 
stock,  except  banks,  trust  companies,  insurance 
and  surety  companies,  railroad  or  street  rail- 


OF  Connecticut  75 

way  companies,  express  companies,  building 
and  loan  associations,  and  investment  com- 
panies, shall,  annually,  on  or  before  the  fifteenth 
day  of  February  or  August,  make,  sign,  and 
swear  to  and  file  in  the  office  of  the  secre- 
tary of  the  state  a  certificate  setting  forth  as  of 
the  first  day  of  January  or  July  immediately 
preceding:  (1)  The  name,  residence,  and  post 
office  address  of  each  of  its  officers  and  direct- 
ors :  (2)  The  amount  of  its  outstanding  capital 
stock  which  has  not  been  paid  for  in  full,  with 
the  amount  due  thereon :  (3)  The  location  of  its 
principal  office  in  this  state,  with  the  street  and 
number,  if  any  there  be,  and  the  name  of  the 
agent  or  person  in  charge  thereof  upon  whom 
process  against  the  corporation  may  be  served. 
The  secretary  shall  thereupon  record  such  cer- 
tificate in  a  book  kept  by  him  for  that  purpose, 
and  shall  furnish  a  certified  copy  of  such  cer- 
tificate to  the  persons  filing  the  same,  who  shall 
forthwith  cause  such  certified  copy  to  be 
recorded  in  the  office  of  the  town  clerk  of  the 
town  in  which  such  corporation  is  located,  and 
said  town  clerk  shall  record  the  same  in  a  book 
kept  by  him  for  that  purpose.  On  the  fifteenth 
day  of  March  and  September  the  town  clerks 
of  the  several  towns  shall  report  to  the  secre- 
tary of  the  state  the  names  of  all  corporations 
whose  annual  returns  have  been  filed  for  record 
during  the  preceding  six  months,  in  accordance 
with  the  provisions  of  this  section,  and  the  sec- 


76  The  Cokpokation  Act 

retary  shall  report  to  the  attorney-general, 
every  six  months,  the  names  of  all  corporations 
which  have  failed  to  comply  with  the  provisions 
of  this  section,  and  the  attorney-general  shall 
collect  all  forfeitures  due  under  this  section. 
Every  corporation  whose  officers  shall  fail  to 
comply  with  the  requirements  of  as  amended 
this  section  shall  forfeit  to  the  state  /uwic  Actfof 
one  hundred  dollars  for  each  fail-  1909,  ch.i6o. 
ure.  Whenever  a  corporation  shall  be  in  the 
hands  of  a  receiver,  or  a  trustee  in  bankruptcy, 
or  a  trustee  in  insolvency,  or  whenever  any 
foreign  corporation  which  has  appointed  the 
secretary  of  the  state  its  attorney  has  ceased  to 
do  business  in  this  state  and  such  fact  is  certi- 
fied to  and  recorded  by  the  secretary  of  the 
state,  or  whenever  any  domestic  corporation 
has  filed  its  first  certificate  of  dissolution,  no 
annual  report  shall  be  required  of  such  corpora- 
tion during  the  period  aforesaid. 

NOTES. 

When  Secretary  may  sign  Annual  Report  instead 
of  President.  By  Public  Acts  of  1907,  Chap.  27,  it  is 
provided  as  follows: 

^^  Whenever,  hy  reason  of  absence,  disability,  or  a 
vacancy  existing  in  the  office,  the  president  of  any 
corporation  is  unable  to  make,  sign,  and  swear  to  the 
annual  report  provided  for  in  section  thirty-seven  of 
chapter  194  of  the  public  acts  of  1903,  such  report 
may  be  signed  and  sworn  to  by  the  secretary  of  such 
corporation  instead  of  by  the  president  thereof;  pro- 


OF  Connecticut  77 

videdy  however,  that  the  secretary  and  treasurer  he 
not  the  same  person.*^ 

Failure  to  file  Annual  Report  for  two  consecutive 
years  is  prima  facie  evidence  of  forfeiture.  By  Public 
Acts  of  1909,  Chap.  200,  it  is  provided  as  follows : 

*  *  Section  1.  Every  corporation  required  to  file  an 
annual  report  under  the  provisions  of  section  thirty- 
seven  of  chapter  194  of  the  public  acts  of  1903  as 
amended  by  chapters  242  and  267  of  the  public  acts 
of  1905  and  chapter  27  of  the  public  acts  of  1907 
which  shall  neglect  to  file  such  report  for  two  con- 
secutive years,  and  shall  not  pay  to  the  state  the  for- 
feitures imposed  for  such  neglect,  shall  prima  facie 
be  deemed  to  have  forfeited  its  corporate  rights  and 
powers,  and  its  corporate  existence  may  be  termi- 
nated in  the  manner  hereinafter  provided;  but  no 
property  rights  or  rights  of  action  in  favor  of  or 
against  such  corporation,  its  officers  or  stockholders, 
and  no  rights  and  franchises  which  have  lawfully 
passed  from  such  corporation  to  any  other  corpora- 
tion, person,  or  persons  shall  be  affected  or  impaired 
by  the  provisions  of  this  act;  and  said  corporation 
shall  continue  in  existence  so  far  as  may  be  necessary 
to  enable  it  to  prosecute  and  defend  suits  by  or 
against  it,  close  up  its  affairs,  dispose  of  its  property, 
and  distribute  its  assets. 

*'Sec.  2.  Whenever  the  default  of  any  such  cor- 
poration to  make  annual  reports  and  pay  said  for- 
feitures shall  have  continued  for  two  consecutive 
years,  the  secretary  of  the  state  shall  notify  said  cor- 
poration by  registered  mail  that,  under  the  provisions 
of  this  act,  its  corporate  rights  and  powers  are  prima 
facie  forfeited,  and  unless  said  corporation  shall  pay 
to  the  state  the  forfeitures  incurred  by  its  defaults 
and,  within  three  months  from  the  mailing  of  said 
notice,  file  a  report,  as  of  the  first  day  of  January  or 
July  immediately  preceding,  made  out  and  verified 
in  all  respects  as  the  annual  reports  of  corporations 


78  The  Cokpokation  Act 

are  required  to  he  made  out  and  verified,  the  secretary 
of  the  state  shall  record,  in  the  records  of  corpora- 
tions in  his  office,  a  certificate,  hy  him  signed,  that  the 
corporate  rights  and  powers  of  the  delinquent  cor- 
poration have  been  forfeited  hy  reason  of  its  defaults, 
and  its  corporate  existence  shall  thereupon  cease  and 
terminate  except  as  provided  in  section  one  and 
except  as  hereinafter  provided;  and  the  secretary  of 
the  state  shall  immediately  send  to  the  delinquent 
corporation,  hy  registered  mail,  a  certified  copy  of 
said  certificate  of  forfeiture. 

''Sec.  3.  At  any  time  within  six  months  after  the 
mailing  of  such  certificate  of  forfeiture  of  corporate 
rights  and  powers,  the  secretary  of  the  state  may 
revoke  said  certificate  of  forfeiture  and  reinstate  said 
corporation  in  the  records  of  his  office  upon  the  pay- 
ment to  the  state  of  all  penalties  and  forfeitures 
incurred  hy  such  defaults  and  of  a  reinstatement  fee 
of  twenty -five  dollars,  and  upon  the  filing  in  his  office 
of  the  report  provided  for  in  the  preceding  section 
as  of  the  first  day  of  January  or  July  immediately 
preceding;  and  thereupon  said  corporation  shall  he 
revested  with  and  he  empowered  to  exercise  all  its 
corporate  rights  and  powers. 

''Sec.  4.  The  provisions  of  this  act  shall  not  he 
held  to  apply  to  any  cemetery  association,  or  to  any 
historical,  lihrary,  literary,  scientific,  school,  or  social 
society,  association,  or  company.^' 

Remission  of  Forfeitures  for  Failure  to  file  Animal 
Reports.  By  Public  Acts  of  1911,  Chap.  147,  it  is 
provided : 

' '  Section  1.  The  attorney -general  may,  upon  such 
terms  as  he  may  prescribe,  remit,  either  wholly  or  in 
part,  any  forfeiture  heretofore  incurred  and  unpaid, 
or  that  may  hereafter  he  incurred,  hy  reason  of  the 
failure  of  any  corporation  to  file  an  annual  report 
under  the  provisions  of  section  thirty-seven  of  chap- 
ter 194  of  the  public  acts  of  1903  and  amendments 


OF  Connecticut  79 

thereof,  when,  in  his  opinion,  it  would  he  inequitable 
to  enforce  collection  thereof. 

*'Sec.  2.     This    act    shall    take    effect    from    its 
passage,'* 


Sec.  38.  Annual  returns  by  express  companies ; 
penalty.  Every  corporation  doing  business 
in  this  state  as  an  express  company  shall,  on 
the  first  day  of  January  of  each  year,  file  in  the 
office  of  the  secretary  of  the  state  a  statement 
of  the  amount  of  its  capital  stock,  the  amount 
actually  paid  thereon  in  cash,  the  time  when 
said  stock  was  issued,  the  amount  of  its  real 
estate,  the  place  where  such  real  estate  is 
located  and  its  cost  and  present  value,  the 
amount  of  personal  estate  held  by  the  company 
and  its  cash  value,  the  amount  of  bills,  notes, 
bonds,  or  other  commercial  security  held  by  the 
company  and  their  value,  the  amount  of  loans 
and  discount  of  the  funds  of  the  company  to  its 
officers  within  the  year  last  past,  the  amount  of 
its  capital  stock  purchased  and  sold  by  it  or  its 
officers  and  agents  for  its  use,  the  amounts  paid 
within  the  year  last  past  for  permanent  better- 
ments of  its  real  estate  and  improvement  of 
equipment  of  its  business,  the  gross  amount  of 
its  receipts  and  disbursements  within  said  year, 
the  amount  of  surplus  cash  on  hand  during  each 
month  of  said  year,  the  amount  of  dividends 
paid  in  the  same  time,  and  the  amount  of  its 
assets  and  liabilities.    Every  such  corporation 


80  The  Corporation  Act 

which  shall  fail  to  file  such  return  for  one 
month  after  said  first  day  of  January  shall,  for 
every  month  of  such  neglect  thereafter,  forfeit 
one  thousand  dollars  to  the  state. 

Sec.  39.  Information  for  creditor.  Every 
person  having  charge  of  the  stock  books  of  any 
corporation  shall  furnish  information  as  to  the 
number  of  shares  held  by  any  stockholder  in 
such  corporation  to  any  applicant  who  shall 
furnish  the  person  in  charge  of  such  books  with 
an  affidavit  that  the  applicant  is  a  creditor  of 
such  stockholder.  Any  person  in  charge  of 
books  as  aforesaid  refusing  to  give  such  infor- 
mation shall  be  fined  not  more  than  one  hundred 
dollars. 

Sec.  40.  Investment  companies ;  bond  issue  lim- 
ited. Whenever  the  board  of  directors  of  any 
corporation  organized  for  the  purpose  of  lend- 
ing money  on  real  estate  security,  and  issuing, 
negotiating,  guaranteeing,  and  dealing  in  bonds 
and  mortgage  securities,  shall  vote  that  said 
corporation  shall  never  issue  and  have  out- 
standing at  any  one  time  bonds  exceeding  a 
certain  amount  specified  in  such  vote,  and  said 
vote  shall  be  ratified  and  approved  by  a  vote  of 
the  stockholders  of  said  corporation,  a  copy  of 
such  votes  of  the  directors  and  stockholders, 
certified  by  the  secretary  and  attested  by  the 
president  and  a  majority  of  the  directors  may 


OF  Connecticut  81 

be  filed  for  record  in  the  office  of  the  secretary 
of  the  state,  and  thereafter  said  vote  shall  be  a 
perpetual  limitation  upon  the  powers  of  such 
corporation. 

Sec.  41.  Supervision  of  investment  companies ; 
guaranty  limited.  Every  corporation  which 
has  power  to  or  does  sell  or  negotiate  its  own 
choses  in  action,  or  sell,  guarantee,  or  negotiate 
the  choses  in  action  of  other  persons  or  corpora- 
tions as  investments,  shall  be  under  the  super- 
vision of  the  commissioner  on  building  and  loan 
associations  and  subject  in  that  particular  to  all 
the  laws  relating  to  the  examination  and  report 
of  banks,  savings  banks,  and  trust  companies. 
Said  commissioner,  in  his  annual  report,  shall 
clearly  describe  the  various  classes  of  assets 
and  liabilities  of  each,  and  state  any  special  pro- 
vision which  has  been  made  for  the  payment  of 
such  liabilities.  No  corporation  doing  business 
as  aforesaid  shall  guarantee,  by  endorsement 
or  otherwise,  debenture  bonds  secured  by  loans 
upon  real  estate  to  an  amount  exceeding  ten 
times  the  amount  of  the  capital  stock  paid  up  in 
cash  and  the  cash  surplus  of  said  corporation. 

NOTE. 

Chapter  293  of  the  Public  Acts  of  1911  prescribes 
the  conditions  which  must  be  complied  with  before 
the  stock  of  any  mining  or  oil  corporation  incor- 
porated in  this  or  any  other  state,  may  be  sold  or 
offered  for  sale  in  Connecticut ;  and  §  5  of  this  chapter 


82  The  Corporation  Act 

provides  that  no  investment  company  shall  do  busi- 
ness in  this  state  until  it  has  been  licensed  by  the 
Building  and  Loan  Commissioner. 

An  Act  Concerning  the  Sale  op  Securities. 

Section  1.  No  shares  or  certificates  of  stock  in 
any  mining  or  oil  corporation  established  under  the 
laws  of  this  or  any  other  state,  nor  any  such  shares 
or  certificates  or  other  securities  of  any  statement  to  be 
other  such  corporation  not  incorporated  filed  with  commis- 
under  the  laws  of  this  state  or  author-  sioner  on  building 
ized  to  do  business  in  this  state,  shall  ^"^  ^°^"  associa- 
te sold  or  offered  for  sale  in  this  state 
until  such  corporation  has  filed  with  the  commissioner 
on  building  and  loan  associations  a  statement  or  cer- 
tificate showing  the  financial  condition  of  such  cor- 
poration, the  location  of  the  mine  or  mines,  or  oil 
properties,  or  other  plant  or  property  owned  by  such 
corporation,  with,  in  the  case  of  a  mining  or  oil  cor- 
poration, plans  of  the  same,  the  amount  of  work  done 
thereon,  the  amount  of  cash  expended  for  improve- 
ments thereon,  and  the  condition  of  the  plant  and 
machinery  connected  therewith,  nor  until  said  com- 
missioner has  given  permission  in  writing  for  such 
sale  or  offer.  Such  statement  or  certificate  shall  be 
subscribed  and  sworn  to  by  the  president,  treasurer, 
and  secretary  of  said  corporation.  The  building  and 
loan  commissioner  shall  make  such,  investigation  of 
the  affairs  of  said  corporation  as  may  be  necessary 
to  ascertain  its  condition  and  the  value  of  its  said 
securities,  and  on  becoming  satisfied,  after  such  exami- 
nation, that  the  sale  of  such  securities  should  be  per- 
mitted, may  issue  to  said  corporation  a  permit,  in 
writing,  authorizing  the  sale  of  the  same  in  this  state. 
For  the  filing  of  such  statement  or  certificate  and  for 
such  examination  a  fee  of  twenty-five  dollars  shall  be 
paid  to  said  commissioner,  for  the  use  of  the  state, 
whether  or  not  permission  is  granted  thereon  as  afore- 
said.    Such  permit,  if  given,  shall  be  valid  for  one 


OF  Connecticut  83 

year  from  its  date  unless  said  commissioner  shall, 
within  said  time,  revoke  the  same  for  cause,  and  such 
permission  may  he  renewed  for  a  period  of  one  year, 
in  the  discretion  of  the  commissioner,  upon  payment 
of  a  fee  of  twenty-five  dollars  for  each  renewal. 

Sec.  2.  Any  person  engaged  in  the  business  of 
selling  or  offering  for  sale  any  such  shares,  certificates 
of  stock,  or  securities,  a  permit  for  the 
sale  of  which,  as  provided  for  in  section 
one  of  this  act,  has  not  been  given  and  in  effect  at  the 
time  of  such  sale  or  offer,  shall  he  fined  not  more  than 
one  hundred  dollars  for  each  offense. 

Sec.  3.  The  building  and  loan  commissioner  shall 
report  to  the  attorney-general  the  names  Building  and 
of  all  persons  and  corporations  who,  ^o  Loan  commis- 
his  knowledge,  are  engaged  in  the  saie  sioner  to  report  to 
of  securities  in  violation  of  the  provi-  ^^®  attorney-gen- 
sions  of  this  act,  and  the  attorney- 
general  shall  cause  prosecutions  therefor  to  be  insti- 
tuted by  the  proper  authorities. 

Sec.  4.     The  foregoing  provisions  shall  not  apply 
to  any  corporation  all  of  whose  mines,  q^^^^^^^  corpora- 
plant,  or  property  are  situated  within  tions  excepted. 
this  state. 

Sec.  5.  No  investment  company  as  defined  by 
section  forty-one  of  chapter  194  of  the  public  acts  of 
1903  shall  do  business  in  this  state  until 
it  has  been  licensed  by  the  commissioner  .  investment 
on  building  and  loan  associations  in  the  j^c^ised^^  ^°  ^^ 
manner  provided  by  section  4009  of  the 
general  statutes  regarding  foreign  building  and  loan 
associations,  and  violations  of  this  provision  shall  be 
subject  to  the  penalties  provided  by  section  forty-five 
of  said  chapter  194  of  the  public  acts  of  1903. 

Sec.  6.     Chapter  196  of  the  public  acts  of  1903 
and  chapter  232  of  the  public  acts  of       Repeal. 
1911  are  hereby  repealed. 


84  The  Cokporation  Act 

Sec.  42.  Collection  of  taxes  on  shares.  When 
any  corporation  has  power  to  impose  a  tax  on 
its  stock,  it  may  appoint  a  collector  thereof, 
who  shall  receive  from  its  treasurer  a  rate  bill, 
and  a  warrant  signed  by  any  justice  of  the 
peace,  directing  such  collector  to  collect  the 
sums  specified  in  such  rate  bill ;  and  on  neglect 
of  any  stockholder  to  pay  the  tax  due  from  him 
within  the  time  limited  by  such  corporation,  the 
collector  may  levy  such  warrant  on  his  shares, 
or  such  part  thereof  as  may  be  necessary  to 
satisfy  such  tax  and  costs,  and  shall  proceed 
therein  in  the  manner  provided  by  law  for  the 
collection  of  executions  when  levied  on  the 
shares  of  the  capital  stock  of  a  corporation; 
and  the  fees  of  such  collector  shall  be  the  same 
as  are  allowed  to  officers  on  executions. 

NOTES. 

This  section  was  originally  enacted  in  1824  and  has 
been  in  force  ever  since.  Whatever  may  be  its  exact 
meaning,  it  has  never  been  construed  by  the  courts. 

Taxation  by  the  State  of  Shares  in  Corporations  is 

provided  for  by  Public  Acts  of  1905,  Chap.  54,  as 
follows : 

^^ Section  2331  of  the  general  statutes  as  amended 
hy  chapter  204  of  the  public  acts  of  1903  is  hereby 
amended  by  striking  out  in  the  sixteenth 
line  of  said  section  the  words  'first  day    Certain  corpora- 
of    February'    and    inserting    in    lieu  ^^^^^  ^°  tax^°to 
thereof    the    words    'thirtieth    day    of  state. 
September  next  prior  thereto/  so  that 
said  section  as  amended  shall  read  as  follows:  The 
secretary,    treasurer,    or    cashier,    of    every    bank, 


OF  Connecticut  85 

national  hanking  association,  trust,  insurance,  invest- 
ment, and  bridge  company,  whose  stock  is  not  exempt 
from  taxation,  shall,  annually,  in  October,  on  or  before 
the  fifteenth  day  thereof,  file  in  the  office  of  the  tax 
commissioner  of  this  state  a  statement  under  oath, 
showing  the  number  of  shares  of  its  capital  stock  and 
the  market  value  thereof  on  the  first  day  of  October, 
the  name  and  residence  of  each  stockholder,  and  the 
number  of  shares  owned  by  each  on  said  last  named 
date;  and,  on  or  before  the  last  day  of  the  following 
February,  each  of  the  corporations  aforesaid  shall  pay 
to  the  treasurer  of  this  state  a  tax  of  one  per  centum 
on  the  market  value  of  each  share  of  its  stock,  as  such 
value  may  be  determined  under  the  provisions  of 
section  2332,  less  the  amount  of  taxes  paid  by  such 
corporation  upon  its  real  estate  in  Connecticut  during 
the  year  ending  on  the  thirtieth  day  of  September 
next  prior  thereto,  all  of  which  real  estate  shall  be 
assessed  and  taxed  in  the  town  or  other  taxing  dis- 
trict within  which  it  is  located.^' 

Taxation  of  property  of  corporations  whose  stock 
is  not  liable  to  taxation,  is  provided  for  by  Gen.  St., 
Rev.  of  1902,  as  follows : 

"§2328.     Property  of  corporation,  how  assessed. 

The  whole  property  in  this  state  of  every  corporation 
organized  under  the  law  of  this  state,  whose  stock  is 
not  liable  to  taxation,  and  which  is  not  required  to 
pay  a  direct  tax  to  this  state  in  lieu  of  other  taxes, 
and  whose  property  is  not  expressly  exempt  from 
taxation,  and  the  whole  property  in  this  state  of  every 
corporation  organized  under  the  law  of  any  other 
state  or  country,  shall  be  set  in  its  list  and  liable  to 
taxation  in  the  same  manner  as  the  property  of 
individuals/' 

Under  §  2328  cash  on  hand  or  on  deposit  in  this 
state  belonging  to  a  foreign  corporation  is  taxable, 
and  the  fact  that  such  corporation  is  in  the  hands 
of  ancillary  receivers  appointed  by  a  court  of  this 


86  The  Corpobation  Act 

state,  and  that  the  money  is  held  for  the  purpose  of 
paying  creditors,  is  immaterial.  Pope  et  als..  Re- 
ceivers, vs.  The  Town  and  City  of  Hartford,  82 
Conn.  406. 

<<§2342.  Property  of  traders  and  manufacturers 
where  listed.  The  property  of  any  trading,  mer- 
cantile, manufacturing,  or  mechanical  business  shall 
he  assessed  in  the  name  of  the  owner  or  owners  in  the 
town,  city,  or  borough  where  the  business  is  carried 
on;  and  the  list  of  any  such  owner  or  owners  shall  he 
given  in  hy  the  person  having  charge  of  such  business 
residing  in  the  town,  city,  or  borough,  when  the  owner 
or  owners  do  not  reside  therein.  The  average  amount 
of  goods  kept  on  hand  for  sale  during  the  year,  or  any 
portion  of  it  when  the  business  has  not  been  carried 
on  for  a  year,  previous  to  the  first  day  of  October, 
shall  he  the  rule  of  assessment  and  taxation;  hut  mer- 
chants shall  also  he  liable  to  he  assessed  for  any 
amount  due  them  from  responsible  persons,  beyond 
their  liabilities;  and  any  merchant  may  have  a  deduc- 
tion from  his  list  of  debts  owing  hy  him,  in  the  same 
manner  and  to  the  same  extent  as  in  §  2349  provided. 
This  section  shall  apply  to.  the  property  of  all  persons, 
whether  residents  of  this  state  or  not,  and  to  the  prop- 
erty of  all  corporations  whether  domestic  or  foreign.^' 

Public  Acts  of  1907,  Chap.  74,  §  5,  provides  as 
follows : 

**Sec.  5.  In  the  town  of  New  Haven,  the  property 
of  any  trading,  mercantile,  manufacturing,  or  me- 
chanical business  shall  he  assessed  and  valued  in  all 
respects  as  provided  hy  section  2342  of  the  general 
statutes;  provided,  however,  that  the  average  amount 
of  goods  kept  on  hand  for  sale  during  the  year,  or 
any  portion  of  the  year  when  the  business  has  not 
been  carried  on  for  a  year  previous  to  the  first  day 
of  June,  shall  be  the  rule  of  assessment  and  taxation 
in  said  town.'^ 


OF  Connecticut  87 

§  2342  has  no  bearing  on  the  question  of  taxing 
cash  on  hand  or  in  bank  belonging  to  such  corporation. 
Pope  et  als.  vs.  The  Town  and  City  of  Hartford,  82 
Conn.  406. 

Returns  to  Tax  Commissioners  are  provided  for  by- 
Public  Acts  of  1909,  Chap.  7,  as  follows : 

"Section  1.  All  statements,  reports,  or  returns 
required  to  be  filed  with  the  tax  commissioner  for  the 
purpose  of  taxation  shall  he  open  only  to  the  inspec- 
tion of  the  tax  commissioner,  his  clerks 
and  assistants,  and  such  other  officers  of  Limiting inspec- 
the  state  as  have  occasion  to  inspect    tio°  ^^  returns  to 

J.         .-,  J,  ,  -,     tax  commissioner 

them  for  the  purpose  of  assessing  and    to  certain  officers. 
collecting  taxes.    The  tax  commissioner 
shall'publish  such  reports  as  are  required  by  law,  and 
may   also   publish   such   other  reports  as  will  give 
information  to  the  public  regarding  taxation. 

''Sec.  2.  This  act  shall  take  effect  from  its 
passage.' ' 

Real  Estate  to  be  set  in  list  of  town  where  it  is 
situated.  Public  Acts  of  1907,  Chap.  184,  provides  as 
follows : 

^^  Section  2329  of  the  general  statutes  is  hereby 
amended  to  read  as  follows:  The  real  estate  of  any 
corporation  mentioned  in  section  2328  shall  be  set  in 
the  list  of  the  town  in  which  such  real 
estate  is  situated,  and  all  of  the  personal  corporate prop- 
estate  of  such  corporation  which  is  per-    ^rty.  where  listed. 

ji       ^         .,  ,    I'  T     '  btocknolaers 

manently  located  or  stationed  %n  any  exempt. 
town  shall  be  set  in  the  list  of  the  town 
in  which  said  property  is  located,  and  all  other  per- 
sonal property  of  such  corporation  shall  be  set  in  the 
list  of  the  town  in  which  such  corporation  has  its 
principal  place  of  business,  or  exercises  its  corporate 
powers;  and  when  it  shall  have  two  or  more  estab- 
lishments for  transacting  its  business  in  different 
towns,  school  districts,  or  other  municipal  divisions, 


88  The  Cokporation  Act 

it  shall  he  assessed  and  taxed  for  every  such  estab- 
lishment, and  for  the  personal  property  attached 
thereto,  or  connected  therewith,  and  not  permanently 
located  in  some  other  town,  in  the  town,  school  dis- 
trict, or  other  municipal  division  having  the  power 
of  taxation  in  which  such  establishment  is;  and  the 
stockholders  of  any  corporation,  the  whole  property 
of  which  is  assessed  and  taxed  in  its  name,  shall  be 
exempt  from  assessment  or  taxation  for  their  stock 
therein." 

Taxing  a  corporation  upon  the  market  value  of  real 
estate  owned  by  it,  and  taxing  individual  stockholders 
upon  the  market  value  of  the  shares  owned  by  them, 
is  not,  strictly  speaking,  double  taxation.  It  may  or 
may  not  come  within  the  equity  of  the  rule  that 
double  taxation  should  be  avoided.  Bulkeley's 
Appeal,  77  Conn.  45. 

Sec.  43.  Alteration  and  repeal  of  charters.  All 
acts  creating  or  authorizing  the  organization  of 
corporations  or  altering  the  charters  of  cor- 
porations, which  have  been  or  shall  be  passed 
by  the  general  assembly,  and  all  charters  under 
which  no  corporation  has  been  organized,  shall 
be  subject  to  alteration,  amendment,  and  repeal 
at  the  pleasure  of  the  general  assembly,  unless 
otherwise  expressly  provided  in  such  acts ;  but 
no  such  amendment  or  repeal  shall  impair  any 
remedy  against  any  such  corporation  or  against 
its  officers,  directors,  or  stockholders,  for  any 
liability  which  shall  have  been  previously 
incurred;  and  all  such  amendments  shall  apply 
to  every  corporation  except  in  so  far  as  is 
otherwise  expressly  provided. 


OF  Connecticut  89 


NOTES. 

It  is  elementary  that  a  charter  is  a  contract  within 
Art.  1,  §  10,  of  the  United  States  Constitution,  for- 
bidding any  State  to  make  any  law  impairing  the 
obligation  of  contracts.  Trustees  of  Dartmouth 
College  vs.  Woodward,  4  Wheat.  (U.  S.)  518. 

Therefore,  if  no  power  to  repeal  the  charter  of  a 
corporation  is  reserved  by  the  state  in  granting  it 
none  can  be  exercised.  Lothrop  et  al.  vs.  Stedman, 
42  Conn.  583. 

Since  a  charter  is  a  contract,  neither  the  directors 
nor  a  majority  of  the  stockholders  can  bind  a  minority 
without  the  assent  of  the  latter,  in  any  matter  which 
is  not  expressly  or  impliedly  authorized  by  the  char- 
ter. Byrne  vs.  Schuyler  Electric  Mfg.  Co.  et  als.,  65 
Conn.  336. 

But  the  grant  from  the  state  is  always  construed 
strictly  against  the  grantees,  and  if  the  charter 
authorizes  the  corporation  in  sweeping  terms  to  do 
certain  things  not  necessary  to  the  main  object  of  the 
grant  and  not  immediately  within  the  contemplation 
of  the  parties,  the  power  remains  within  the  control 
of  the  legislature  so  long  as  it  remains  unexecuted 
and  no  rights  have  vested  under  it  and  may  be  treated 
as  a  license  and  revoked.  Pearsall  vs.  Great  Northern 
Railway,  161  U.  S.  646. 

The  reserved  power  of  amendment  of  the  charter 
of  a  water  company  includes  the  right  to  make  any 
alterations  which  do  not  substantially  impair  the 
object  of  the  grant  or  affect  vested  rights;  and  the 
alterations  may  result  from  the  operation  of  general 
laws,  as  well  as  from  special  legislation  addressed  to 
the  corporation  itself.  Town  of  Southington  vs. 
Southington  Water  Co.,  80  Conn.  646. 

Alterations  in  the  charter  of  a  corporation  which 
make  a  material  or  fundamental  change  therein  will 
not  become  operative  unless  accepted  or  assented  to 
by  all  the  stockholders.  Those  which  make  auxiliary 
or  incidental  changes  only  will  become  operative  upon 


90  The  Cobporation  Act 

acceptance  by  a  majority.  There  is  no  exact  formula 
for  ascertaining  what  changes  are  fundamental  and 
what  incidental.  Each  case  must  be  determined  upon 
its  own  peculiar  facts.  Perkins  vs.  Coffin,  84  Conn. 
275. 

Sec.  44.  Forms  for  certificates.  The  secre- 
tary of  the  state  shall  prepare  forms  for  the 
several  certificates  and  returns  required  by  this 
act. 

Sec.  45.  Penalty  for  violation  of  this  act. 
Every  person  who  shall  violate  any  of  the  pro- 
visions of  this  act,  for  which  no  penalty  or  pun- 
ishment is  expressly  prescribed,  shall  be  fined 
not  more  than  one  thousand  dollars. 

NOTES. 

Gen.  Stat.,  Rev.  of  1902,  ''§  1022.  Enforcement  of 
corporation  laws.  Any  stockholder  of  a  corporation 
may  apply  for  a  writ  of  mandamus  against  such  cor- 
poration, to  compel  it  to  obey  the  statute  laws  of  this 
state.'' 

Since  section  45  imposes  a  penalty,  an  action 
brought  under  it  does  not  survive  the  death  of  an 
officer  thus  liable.  Mitchell  et  als.  vs.  Hotchkiss,  48 
Conn.  9. 

Where  a  corporation  is  proceeding  in  contravention 
of  its  charter  obligations,  and  refuses  to  fairly  and 
fully  perform  a  specific  duty  imposed  on  it  either  by 
its  charter  or  a  general  statute,  mandamus  is  the 
proper  remedy  to  compel  performance  if  there  is  no 
other  specific  remedy.  State  vs.  Hartford  &  N.  H. 
R.  R.  Co.,  29  Conn.  538. 


OF  Connecticut  91 

To  justify  the  issue  of  a  writ  of  mandamus  to  com- 
pel a  private  corporation  to  do  a  particular  act,  '4t 
must  appear  that  the  act  is  in  the  nature  of  a  cor- 
porate act  specially  commanded  by  law;  and  in  gen- 
eral it  will  issue  only  at  the  instance  of  the  public  or 
of  some  person  entitled  to  represent  the  public,  includ- 
ing the  individual  in  respect  to  whom  the  act  com- 
manded is  to  be  done,  or  of  some  person  who,  though 
a  stranger  to  the  corporation  and  to  the  public 
interest,  suffers  an  infraction  of  his  private  right  at 
the  hands  of  the  corporation  in  doing  the  act  for- 
bidden or  not  doing  the  act  commanded;  and  in  this 
latter  case  the  mandamus  compelling  performance  of 
the  corporate  duty  should  be  an  effective  remedy  for 
the  infraction  of  the  private  right,  and  must  be  the 
only  full  and  adequate  remedy  for  that  infraction." 
State,  ex.  rel.  Howard,  vs.  Hartford  Street  Railway 
Company,  76  Conn.  174  at  179. 

See  also  American  Asylum  vs.  Phoenix  Bank,  4 
Conn.  172;  Lyon  et  als.  vs.  Rice  et  als.,  41  Conn. 
245;  Peck  vs.  Booth  etals.,  42  Conn.  271;  State  vs. 
Towers,  71  Conn.  657. 

The  performance  of  a  purely  ministerial  duty  of  an 
officer  of  a  corporation  may  be  enforced  by  man- 
damus, and  stockholders  may  therefore  resort  to  that 
remedy  to  compel  the  officers  to  call  a  meeting. 
Bassett  et  al.  vs.  Atwater,  Pres.,  et  al.,  65  Conn.  355. 
But  the  remedy  cannot  be  used  ''for  the  enforcement 
of  merely  private  obligations  such  as  those  arising 
from  contracts,"  Lahiff  vs.  St.  Joseph's  Total  Absti- 
nence and  Benevolent  Soc,  76  Conn.  648  at  651 ;  and 
for  this  reason  it  cannot  be  used  to  compel  the  secre- 
tary of  a  private  corporation  to  allow  a  stockholder 
to  transfer  his  stock  on  the  books  and  to  issue  a  certifi- 
cate, since  the  corporation  may  be  held  in  an  action 
for  damages  or  a  court  of  equity  give  relief  if  the 
purchaser  is  entitled  to  the  specific  stock.  Tobey  vs. 
Hakes,  54  Conn.  274. 


92  The  Cokpokation  Act 


PART  II. 

CORPOKATIOKS    OeGANIZED    UNDER    SpECIAL 

Charter. 

Sec.  46.  Location  not  to  be  changed.  No  bank, 
savings  bank,  insurance  company,  or  trust  com- 
pany shall  change  its  location  from  one  town 
to  another  except  by  an  act  of  the  general 
assembly. 

NOTE. 

For  change  in  location  of  corporations  formed 
under  general  laws,  see  §§  73,  74,  infra,  pages  116, 117. 

Sec.  47.     Increase  of  capital  stock.    Every  spe- 
cially chartered  corporation  having  power  by 
law  to  increase  its  capital  stock  may     as  amended 
from  time  to  time  so  increase  it    ^^^^}'!^^'^: 

Public  Acts  of 

by  issuing  additional  shares  of  the  1907,  chap.  246. 
same  par  value,  under  such  limitations  as  to  the 
amount  issued  and  of  every  other  nature  what- 
soever as  may  exist  either  in  its  charter  or  in 
any  statute  affecting  it;  provided,  that,  at  a 
meeting  of  its  stockholders  warned  and  held  for 
that  purpose,  such  increase  shall  have  been 
authorized  by  a  vote  of  at  least  two-thirds  of 
each  class  of  stock  issued  and  outstanding  at 
the  time  of  said  vote,  which  vote  shall  state  the 
amount  of  the  increase  so  authorized;  or  pro- 
vided, that,  at  a  meeting  of  its  stockholders  held 


OF  Connecticut  93 

for  that  purpose,  a  written  or  printed  notice  of 
which  stating  the  day,  hour,  place,  and  purpose 
thereof  shall  have  been  given  by  the  president 
or  secretary  to  each  stockholder  by  leaving  such 
notice  with  him  or  at  his  residence  or  usual 
place  of  business  or  by  mailing  such  notice  to 
him  at  his  last  known  post  office  address  at  least 
thirty  days  before  such  meeting,  such  increase 
shall  have  been  authorized  by  a  vote  of  at  least 
two-thirds  of  each  class  of  stock  represented  at 
such  meeting.  Before  any  such  corporation 
shall  issue  any  shares  of  such  increased  capital 
stock  so  voted,  a  majority  of  the  directors  shall 
make,  sign,  and  swear  to  and  file  in  the  office  of 
the  secretary  of  the  state  a  certificate  setting 
forth  the  number  of  shares  so  voted  and  the  par 
value  thereof.  The  secretary  shall  examine  the 
same,  and  if  he  shall  find  that  it  conforms  to 
law  and  that  all  taxes  have  been  paid  in  accord- 
ance with  the  provisions  of  section  57,  shall 
endorse  thereon  the  word  ** Approved,''  with 
his  name  and  official  title,  and  shall  thereupon 
record  such  certificate  in  a  book  kept  by  him 
for  that  purpose. 

NOTES. 

Capital  stock  may  be  increased  under  authority  of 
this  section  by  the  declaration  of  a  stock  dividend. 
The  Stamford  Trust  Company,  Trustee,  vs.  The  Yale 
&  Towne  Mfg.  Co.  et  al.,  83  Conn.  43. 

If  a  corporation  decides  to  increase  its  capital  under 
its  authority  to  do  so  the  existing  stockholders  have 


94  The  Cokpoeation  Act 

the  option  to  subscribe  for  and  hold  the  new  stock  in 
proportion  to  their  interest  in  the  old,  and  a  stock- 
holder who  is  denied  the  right  may  sustain  an  action 
against  the  corporation  for  the  injury.  Angell  & 
Ames  on  Corporations,  §  544. 

Where  stock  is  held  in  trust  the  right  to  subscribe 
for  the  new  stock  is  capital,  the  profits  on  the  sale  of 
that  right  and  the  new  shares  taken  belong  to  the 
fund  and  not  part  of  the  income.  Brinley  et  al.. 
Trustees,  vs.  Grou  et  al.,  50  Conn.  66;  Smith  et  al.. 
Trustees,  vs.  Dana  et  al.,  77  Conn.  543;  Boardman 
et  al.  vs.  Mansfield  et  al..  Executors,  79  Conn.  634. 

For  certificate  of  increase  of  capital  stock  of 
domestic  corporations  organized  under  general  laws, 
see  §§  73,  74,  infra,  pages  116,  117. 

For  certificate  of  increase  or  reduction  of  capital 
stock  of  foreign  corporations,  see  §  86,  infra,  page  127. 

Sec.  48.  Stock  preferred  as  to  dividends.  Any 
specially  chartered  corporation,  not  engaged 
either  in  a  trust,  insurance,  or  banking  business 
or  in  trading  in  bonds,  notes,  or  other  evidences 
of  indebtedness,  which  has  by  law  power  to 
increase  its  capital  stock,  may  so  increase  it  by 
the  issue  of  preferred  stock,  which  shall  be 
entitled  to  dividends  of  an  agreed  amount 
before  any  dividends  are  declared  upon  the 
stock  already  issued;  and  such  dividends,  if 
not  paid  in  any  one  year,  may  be  paid  out  of 
the  earnings  of  subsequent  years,  if  it  be  so 
provided  in  the  vote  authorizing  such  increase. 

Sec.  49.  Stock  preferred  as  to  assets.  Any 
specially  chartered  corporation,  having  power 
under  section  48  of  this  act  to  issue  stock  pre- 


OF  Connecticut  95 

ferred  as  to  dividends,  may  also  issue  stock  pre- 
ferred as  to  assets,  the  holders  of  which  shall, 
in  case  of  the  winding  up  of  the  corporation, 
be  paid  up  to  the  full  par  value  of  such  pre- 
ferred stock,  out  of  the  net  assets  available  for 
distribution  to  stockholders,  before  the  hold- 
ers of  other  stock  receive  anything;  and,  if  the 
holders  of  a  majority  of  the  common  stock  shall 
so  vote,  the  holders  of  such  preferred  stock  may 
be  given  the  right  to  exchange  such  preferred 
stock  for  common  stock,  on  such  terms  and  con- 
ditions as  may  be  determined  by  said  vote ;  but 
the  total  capital  stock  of  the  corporation  shall 
not  be  increased  by  such  exchange. 

Sec.  50.  Issue,  how  authorized.  No  issue  of 
preferred  stock  shall  be  made  unless  authorized 
at  a  meeting  of  the  stockholders  warned  and 
held  for  that  purpose,  by  a  vote  of  stockholders 
holding  not  less  than  two-thirds  of  the  stock  of 
such  corporation,  which  vote  shall  determine 
the  amount  of  preferred  stock  so  to  be  issued, 
the  number  and  value  of  the  shares  thereof,  the 
dividends  to  be  paid  thereon,  whether  the  same 
shall  be  cumulative  or  not,  and  the  terms  of  the 
preferment  as  to  assets,  if  such  preferment  is 
made. 

Sec.  51.  Certificate  of  increase.  No  certificate 
for  such  preferred  stock  shall  be  issued  until  a 
majority  of  the  directors  have  made,  signed. 


96  The  Cokporation  Act 

and  sworn  to  and  filed  in  the  office  of  the  secre- 
tary of  the  state  a  certificate  setting  forth  the 
increase  of  such  capital  stock,  the  number  and 
value  of  such  shares,  the  amount  of  the  dividend 
to  be  paid  thereon,  whether  the  same  is  to  be 
cumulative  or  not,  and  the  terms  of  the  prefer- 
ment as  to  assets,  if  such  preferment  is  made. 
The  secretary  shall  thereupon  record  such  cer- 
tificate in  a  book  kept  by  him  for  that  purpose. 
The  certificate  required  by  this  section  shall  be 
in  addition  to  those  required  by  law  in  relation 
to  the  increase  of  capital  stock. 

Sec.  52.  Reduction  of  capital  stock.  Any  spe- 
cially chartered  corporation  may  reduce  its 
capital  stock.  No  such  reduction  shall  be  valid 
unless  approved  by  a  vote  of  two-thirds  of  all 
outstanding  stock  of  each  class  at  a  meeting  of 
the  stockholders  warned  and  held  for  that  pur- 
pose, nor  unless  a  majority  of  the  directors 
shall  make,  sign,  and  swear  to  and  file  in  the 
office  of  the  secretary  of  the  state  a  certificate 
stating  that  the  reduction  has  been  duly  ap- 
proved by  the  stockholders  and  setting  forth  a 
copy  of  the  vote  of  the  stockholders,  which  vote 
shall  show  the  details  as  to  such  reduction.  The 
secretary  shall  record  such  certificate  in  a  book 
kept  by  him  for  that  purpose. 

NOTES. 

For  reduction  of  stock  of  corporations  organized 
under  general  laws,  see  §  74,  infra,  page  117. 


OF  Connecticut  97 

For  liability  of  stockholders  voting  for  reduction 
of  capital  stock  causing  insolvency,  see  §  6,  supra, 
page  23. 

Sec.  53.  Change  of  name  by  Superior  Court. 
Any  specially  chartered  corporation,  having 
voted  to  change  its  corporate  name,  may  apply 
to  the  superior  court  for  the  county  in  which  it 
is  located  to  have  such  change  made,  first  giving 
notice  of  such  intended  application  by  adver- 
tisement for  two  weeks  consecutively  in  a  news- 
paper published  in  Hartford  or  New  Haven  and 
a  newspaper,  if  there  be  one,  published  in  the 
town  in  which  the  corporation  is  located;  and 
said  court  may  change  said  name  as  prayed  for, 
and,  upon  filing  for  record  in  the  office  of  the 
secretary  of  the  state  a  certified  copy  of  the 
order  of  the  court,  the  name  of  such  corporation 
shall  be  as  decreed  by  said  court ;  but  no  right 
existing  at  the  time  of  such  change  in  favor  of 
or  against  such  corporation  shall  be  affected 
thereby.  The  secretary  shall  thereupon  record 
such  certified  copy  in  a  book  kept  by  him  for 
that  purpose. 

Sec.  54.     Charter  without  organization  void  after 
two    years.      The    charter   of   every   specially 
chartered  corporation,  except  as  otherwise  pro- 
vided by  law,  shall  be  void,  unless     as  amended 
such  corporation  shall  be  organized    p^^iJ'j^^^'^^ 
and  a  certificate  of  such  organiza-     i905.  ch.  219. 
tion,  sworn  to  by  the  president  or  secretary,  or, 


98  The  Cokporation  Act 

if  there  be  no  such  officers,  by  an  officer  having 
custody  of  the  records  of  such  corporation,  shall 
be  filed  in  the  office  of  the  secretary  of  the  state 
within  two  years  from  the  date  of  the  approval 
of  such  charter.  The  secretary  shall  thereupon 
record  such  certificate  in  a  book  kept  by  him  for 
that  purpose. 

Sec.  55.  Acceptance  and  effect  of  charter  amend- 
ment. When  any  amendment  or  alteration  of 
the  charter  of  any  specially  chartered  corpora- 
tion shall  be  made,  if  it  be  not  otherwise 
specially  provided  in  the  resolution  making 
such  alteration  or  amendment,  it  shall  not  be- 
come operative  unless,  within  six  months  after 
its  passage,  it  shall  be  accepted  at  a  meeting  of 
such  corporation  warned  and  held  for  that  pur- 
pose, nor  unless,  within  said  period,  an  attested 
copy  of  said  acceptance  shall  be  filed  in  the 
office  of  the  secretary  of  the  state,  to  be  re- 
corded by  him  in  a  book  kept  for  that  purpose ; 
and  such  acceptance  shall  make  the  original 
charter  and  all  resolutions  amending  and  alter- 
ing the  same  subject  to  amendment,  alteration, 
and  repeal,  at  the  pleasure  of  the  general 
assembly.  If  such  amendment  shall  be  made 
before  the  acceptance  of  the  original  charter, 
then  such  amendment  may  be  accepted  at  the 
same  time  such  original  charter  is  accepted. 

Sec.  56.  Reports  to  general  assembly.  Cor- 
porations   required    to    make    reports    to    the 


OF  Connecticut  99 

general  assembly  shall  make  them  during  the 
first  week  of  each  regular  session. 

Sec.  57.  Tax  on  stock  issue  authorized  by  special 
act;  penalty.  Before  any  bill  or  resolution 
creating  a  corporation  having  a  capital  stock 
shall  be  approved  or  become  a  law,  there  shall 
be  paid  to  the  state  treasurer,  in  addition  to  the 
fees  required  by  section  10  of  the  general 
statutes,  a  franchise  tax  of  one  dollar  on  each 
one  thousand  dollars  of  the  capital  stock  with 
which  it  is  to  be  organized,  but  such  tax  shall  in 
no  case  be  less  than  fifty  dollars.  If  such  bill  or 
resolution  shall  not  be  approved  or  become  a 
law,  the  treasurer  shall  return  the  tax  so  paid. 
Whenever  any  specially  chartered  corporation 
shall  vote  to  increase  the  amount  of  its  capital 
stock  in  accordance  with  the  provisions  of  this 
act  or  of  any  other  general  or  special  law  affect- 
ing it,  such  corporation  shall  pay  to  the  state 
treasurer  before  any  shares  of  such  increased 
capital  stock  shall  be  issued,  a  further  tax  of  one 
dollar  on  each  one  thousand  dollars  of  the  total 
increased  capital  stock  so  voted,  but  no  addi- 
tional franchise  tax  shall  be  required  upon  stock 
upon  which  the  corporation  has  paid  the  full 
franchise  tax  required  by  the  law  in  force  at  the 
time  of  such  payment.  Every  officer  of  any  cor- 
poration subject  to  any  of  the  provisions  of  this 
section,  who  shall  sign  or  issue  any  certificate 
of  stock  on  which  the  tax  imposed  by  this  sec- 


100  The  Cobpokation  Act 

tion  has  not  been  paid,  shall  be  fined  one  thou- 
sand dollars,  or  imprisoned  not  more  than  two 
years,  or  both. 


PART  III.  \ 

The  Cobpokation  Act  of  1901. 

Sec.  58.  Application.  The  provisions  of  this 
part  shall  apply  to  all  corporations  formed 
under  it  and  to  all  corporations  heretofore 
organized  under  the  joint  stock  law  of  this 
state  or  the  corporation  act  of  1901,  but  shall 
not  require  the  reorganization  of  corporations 
heretofore  formed. 

Sec.  59.  Powers.  Every  corporation  to 
which  this  part  applies,  in  addition  to  all  other 
powers  granted  by  law,  shall  have  power  to 
mortgage  its  real  and  personal  estate,  including 
its  franchises,  and  issue  promissory  notes, 
bonds,  or  other  evidences  of  indebtedness. 
Such  corporation  may  also  issue  one  or  more 
classes  of  stock. 

NOTES. 

Chap.  180  of  the  Public  Acts  of  1907,  provides  as 
follows : 

'^  Section  1.  Any  provision  of  law  regarding 
trust  companies,  whether  contained  in  the  general 


OF  CoNNECTictrg^^  ;"•',  ;,,  ; ;'  '>,:JOJ.',\i  i/A 

statutes  or  in  the  charter  of  any  trust 

company    incorporated    by    this    state,    limitation  on 

T  .T      ^   n        .    '^  .,      ,         ,  powers  of  trust 

which  authorizes  or  permits  trust  com-  companies. 
panies  to  issue,  sell,  or  negotiate  their 
own  bonds  or  mortgage  securities,  or  their  own  choses 
in  action  secured  by  mortgage  of  real  estate  which 
are  to  be  issued,  sold,  or  negotiated  as  investments,  or 
which  authorizes  or  permits  trust  companies  to  guar- 
antee the  bonds,  mortgage  securities,  or  other  choses 
in  action  of  other  persons  or  corporations  issued,  sold, 
or  negotiated  as  investments,  or  which  authorizes  or 
permits  trust  companies  to  engage  in  the  business  of 
marine,  fire,  or  life  insurance,  or  fidelity,  surety, 
accident,  health,  liability,  credit,  title,  or  other  form 
of  casualty  insurance,  is  hereby  repealed;  and  to  that 
extent  this  act  shall  be  an  amendment  to  the  charter 
of  every  such  trust  company,  and  it  shall  not  be  neces- 
sary for  such  companies,  or  any  of  them,  to  accept 
said  amendment. 

''Sec.  2.  This  act  shall  not  apply  to  any  corpora- 
tion actually  engaged  on  the  first  day  of  January, 
1907,  in  the  business  of  a  title  insur- 
ance and  guarantee  company,  in  so  far  Not  applicable 
as  the  right  of  such  company  to  con- 
tinue such  business  of  title  insurance  and  guarantee 
is  concerned.'' 

Chap.  260  of  the  Public  Acts  of  1911,  provides  as 
follows:  ^'When  any  manufacturing  or  mechanical 
establishment,  together  with  the  machinery,  engines, 
or  implements  situated  and  used  there-      „   , 

'^  ...  ,  , .  ,  .  Mortgage  upon 

in,  or  any  printing,  publishing,  or  en-  machinery  of 
graving  establishment,  together  with  manufacturing 
the  machinery,  engines,  implements,  corporations  to 
cases,  types,  cuts,  or  plates,  situated  qutedmaciTine^' 
and  used  therein,  or  any  of  the  per- 
sonal property  above  mentioned,  without  the  real  es- 
tate in  which  the  same  is  situated  or  used,  shall  be 
mortgaged  by  a  deed  containing  a  condition  of  defeas- 


/•J8^.;  'W  ^^,'^;K■}s.  CoKPOKATioN  Act 

ance  executed,  acknowledged,  and  recorded  as  mort- 
gages of  land  in  accordance  with  the  laws  of  this  state, 
if  such  mortgage  so  recorded  shall  provide  that  any 
after-acquired  property  forming  a  part  of  the  estab- 
lishment and  connected  with  or  situated  and  used 
therein,  or  any  after-acquired  substituted  machinery 
or  personal  property,  of  like  nature  to  the  property 
included  in  such  mortgage,  shall  be  covered  by  such 
mortgage,  such  mortgage  shall  be  deemed  valid  and 
effectual  as  respects  all  such  after -acquired  or  sub- 
stituted property  or  machinery  and  the  retention  by 
the  mortgagor  of  the  possession  of  such  property 
shall  not  impair  the  title  of  the  mortgagee,  and 
such  mortgages  may  be  foreclosed  under  and  in 
accordance  with  the  provisions  of  section  4132  of  the 
general  statutes.^' 

Chap.  197  of  the  Public  Acts  of  1911,  provides  as 
follows : 

^^  Section  1.  No  person  or  corporation,  except 
a  bank,  trust  company,  or  building  and  loan 
association  incorporated  under  the  laws 
of  the  United  States  or  this  state,  ^";e^sfricTed^'''^ 
shall  cause  to  be  published  any  adver- 
tisement or  display  any  sign  containing  the  word 
^bank,'  *  trust,'  or  ^savings,'  or  any  artificial  or 
corporate  name,  or  any  other  word  or  words  indi- 
cating that  such  person  or  corporation  is  a  bank, 
trust  company,  savings  bank,  or  building  and  loan 
association,  or  shall  in  any  way  solicit  or  receive  de- 
posits as  a  savings  bank.  Every  person  or  corpora- 
tion violating  any  provision  of  this  act  shall  be  fined 
not  more  than  one  thousand  dollars.  This  act  shall 
not,  however,  prohibit  such  firms  or  individuals,  doing 
business  as  private  bankers  under  their  own  name  or 
names,  as  have  deposited  with  the  state  treasurer  a 
bond  of  ten  thousand  dollars  secured  either  by  a 
surety  company  of  recognized  standing  or  by  an  indi- 
vidual or  individuals  owning  real  estate  within  the 
state,  or,  at  the  option  of  such  firms  or  individuals. 


OF  Connecticut  103 

securities  of  the  value  of  not  less  than  said  amount, 
to  the  acceptance  of  said  treasurer,  conditioned  for 
the  protection  of  their  customers,  from  styling  them- 
selves hankers  in  the  conduct  of  their  said  business. 

*'Sec.  2.  All  corporations,  partnerships,  or  indi- 
viduals engaged  in  the  business  of  re-  corporations, 
ceiving  money  for  safe-keeping  or  for-  partnerships  or 
warding  shall  report  to  the  bank  com-  individuals,  en- 
missioners  that  they  are  engaged  in  fjf^^mo^ne^^^flTr 
such  business,  and  shall  file  with  the  safe-keeping  to 
state  treasurer  the  bond  or  securities  report  to  bank 
provided  by  section  one  of  this  act.  commissioners. 

*'Sec.  3.    Section  one  of  chapter  209  of  the  public 
acts   of   1905   and   chapter   86    of    the 
public  acts  of  1907  are  hereby  repealed.' *        Repeal. 

Condemnation  of  railroad  company  shares. 

Gen.  Stat.,  §  3694,  authorizes  any  railroad  company 
which  has  acquired  more  than  three-fourths  of  the 
capital  stock  of  any  other  railroad  company  to  take 
the  outstanding  stock  by  condemnation  proceedings, 
if  necessary,  and  upon  a  judicial  finding  that  such  an 
acquisition  will  be  for  the  public  interest.  It  was 
held  that  this  statute  did  not  confer  exclusive  privi- 
leges upon  any  set  of  men  in  violation  of  the  consti- 
tution of  this  State,  that  it  did  not  deprive  the  stock- 
holder of  his  property  without  due  process  of  law, 
nor  did  it  impair  the  obligation  of  a  contract.  New 
York,  New  Haven  &  Hartford  R.  R.  Co.  vs.  Offield, 
77  Conn.  417,  affirmed  203  U.  S.  372. 

A  national  bank  is  not  exempt  from  the  operation 
of  State  laws,  provided  they  do  not  impair  its  effi- 
ciency in  performing  those  functions  by  which  it  was 
designed  to  serve  the  United  States,  nor  trench  upon 
the  field  occupied  by  the  legislation  of  Congress. 
Cogswell  vs.  Second  National  Bank  of  Norwich,  76 
Conn.  252. 


104  The  Corporation  Act 

Sec.  60.  Certificates.  Every  certificate  re- 
quired by  this  part  to  be  filed  shall  be  signed 
and  sworn  to  by  the  persons  required  to  file  it, 
and  shall  be  filed  in  the  office  of  the  secretary  of 
the  state,  who  shall  examine  the  same,  and,  if 
he  shall  find  that  it  conforms  to  law  and  that 
all  taxes  which  may  be  due  upon  the  filing  of  the 
certificate  under  the  provisions  of  section  61 
of  this  act  have  been  paid,  shall  endorse  thereon 
the  word  ^^ Approved,^'  with  his  name  and  offi- 
cial title,  and  shall  thereupon  record  such  cer- 
tificate in  a  book  kept  by  him  for  that  purpose. 
No  act  required  to  be  set  forth  in  any  such  cer- 
tificate shall  be  valid  until  such  certificate  has 
been  approved  as  aforesaid,  but  this  provision 
shall  not  relieve  the  corporation,  its  officers,  di- 
rectors, or  stockholders  from  any  liability  which 
might  otherwise  be  enforcible  against  them  or 
any  of  them,  or  invalidate  any  of  the  stock  of 
such  corporation  in  the  hands  of  bona  fide 
holders  without  notice.  No  such  corporation 
shall  commence  business  until  a  copy  of  the 
certificate  required  by  section  63  hereof,  duly 
certified  by  the  secretary  of  the  state,  shall  have 
been  filed  in  the  office  of  the  town  clerk  of  the 
town  where  the  said  corporation  is  to  be  located ; 
and  said  town  clerk  shall  record  the  same  in  a 
book  kept  by  him  for  that  purpose. 

Sec.  61.  Tax  on  capital  stock.  Every  such 
corporation,  before  its  certificate  of  incorpora- 


OF  Connecticut  105 

tion  shall  be  approved  by  the  secretary  of  the 
state,  shall  pay  to  the  state  treasurer  fifty  cents 
on  every  one  thousand  dollars  of  its  authorized 
capital  stock  up  to  five  million  dollars;  and  it 
shall  pay  ten  cents  upon  every  one  thousand 
dollars  of  its  authorized  capital  stock  in  excess 
of  five  million  dollars.  Whenever  any  corpora- 
tion organized  under  the  provisions  of  this  part, 
or  under  any  former  joint  stock  law  of  this 
state,  shall  increase  the  amount  of  its  author- 
ized capital  stock,  it  shall  pay  tq  the  state 
treasurer,  before  the  certificate  of  increase  shall 
be  approved,  fifty  cents  on  each  one  thousand 
dollars  of  such  authorized  increase  until  it  has 
paid  on  a  total  capital  stock  of  five  million 
dollars;  and,  upon  any  authorized  increase  of 
capital  stock  above  five  million  dollars,  it  shall 
pay  to  the  state  treasurer  ten  cents  on  each  one 
thousand  dollars;  but  no  payment  under  the 
provisions  of  this  section  shall  be  less  than 
twenty-five  dollars.  Said  payments  shall  be  in 
lieu  of  all  other  taxes  upon  the  franchise  of  the 
corporation,  but  shall  not  be  in  lieu  of  any  tax 
imposed  by  law  upon  the  property  of  the  cor- 
poration or  upon  the  shares  of  its  stock  in  the 
hands  of  its  stockholders. 

Sec.  62.  Formation.  Any  three  or  more  per- 
sons may  associate  to  form  a  corporation  under 
this  act  for  the  transaction  of  any  lawful  busi- 
ness.    Such  corporation  shall  not  have  power, 


106  The  Cokpoeation  Act 

however,  to  transact  in  this  state  the  business 
of  a  bank,  savings  bank,  trust  company,  build- 
ing and  loan  association,  insurance  company, 
surety  or  indemnity  company,  railroad  or  street 
railway  company,  telegraph  or  telephone  com- 
pany, gas,  electric  light,  or  water  company,  or 
of  any  company  requiring  the  right  to  take  and 
condemn  lands  or  to  occupy  the  public  highways 
of  this  state,  but  shall  have  power  to  transact 
such  business  in  any  state  or  territory  of  the 
United  States,  or  in  any  foreign  country,  if  not 
prohibited  by  the  laws  of  such  state  or  territory 
or  foreign  country. 

NOTES. 

Chapter  245  of  the  Public  Acts  of  1907  provides 
for  the  formation  of  a  telephone  company  under  the 
provisions  of  the  Corporation  Act  and  to  that  extent 
repeals  §  62  thereof. 

Chapter  245. 

An  Act   Concerning  the   Organization  op  Tele- 
phone Companies. 

Section  1.      Any    three    or    more    persons    may 
associate  themselves  to  form  a  joint  stock  corporation 
to  do  a  telephone  exchange  business,  and  to  build, 
maintain,  and  operate  a  telephone  sys- 
tem, and  may  organize  for  that  purpose      Telephone  com- 
under  the  provisions  of  chapter  194  of    ?^"^  "\^^  organ- 
the  public  acts  of  1903  as  modified  here-    stock  law. 
by,  and  any  company  organized  under 
the  provisions  of  this  act  shall  have  all  the  rights 
conferred  and  be  subject  to  all  the  restrictions  and 


OF  Connecticut  107 

obligations  imposed  hy  chapter  219  of  the  general 
statutes. 

Sec.  2.      Any   part   of   any   act   prohibiting    the 
organization  of  joint  stock  corporations  to  do  a  tele- 
phone exchange  business  under  the  laws    .   R^p^^ 
of  this  state,  or  requiring  a  special  char- 
ter therefor,  in  so  far  as  the  same  is  inconsistent  with 
the  provisions  of  this  Act,  is  hereby  repealed. 

Approved,  July  31,  1907. 

For  definition  of  a  private  corporation  see  §  2, 
supra,  pages  3,  4. 

A  state  may  grant  a  franchise  of  incorporation  to 
a  corporation  of  another  state  or  to  corporations 
chartered  by  different  states,  as  fully  as  to  natural 
persons  who  are  citizens  of  the  different  states. 
Mackay  vs.  New  York,  New  Haven  &  Hartford  R.  R. 
Co.  et  al.,  82  Conn.  73. 


Sec.  63.  Certificate  of  incorporation.  The  per- 
sons so  associated  shall  file  a  certificate  setting 
forth:  (1)  The  name  of  the  corporation:  (2) 
The  name  of  the  town  in  this  state  in  which  the 
corporation  is  to  be  located:  (3)  The  nature 
of  the  business  to  be  transacted  or  the  purposes 
to  be  promoted  or  carried  out :  (4)  The  amount 
of  authorized  capital  stock,  which  shall  not  be 
less  than  two  thousand  dollars,  the  number  of 
shares  into  which  the  same  is  divided,  and  the 
par  value  of  each  share,  which  shall  not  be  less 
than  twenty-five  dollars,  and,  if  there  be  more 
than  one  class  of  stock,  a  description  of  the  dif- 
ferent classes  with  the  terms  on  which  they  are 


108  The  Cokpoeation  Act 

respectively  created:  (5)  The  amount  of  capi- 
tal stock  with  which  the  corporation  shall  com- 
mence business,  which  shall  not  be  less  than  one 
thousand  dollars:  (6)  The  period,  if  any, 
limited  for  the  duration  of  the  corporation. 

NOTES. 

The  statement  in  a  certificate  of  incorporation  that 
all  the  shares  of  stock  of  the  corporation  have  been 
paid  for  estops  its  signers  from  afterward  asserting 
the  contrary  as  against  those  who  may  become  its 
creditors.    Baldwin,  Trustee,  vs.  Wolff,  82  Conn.  559. 

Defestition  op  Purpose. 

The  article  in  the  certificate  of  incorporation  stat- 
ing the  nature  of  the  business  to  be  transacted  or  the 
purposes  for  which  the  corporation  is  organized, 
should  be  drawn  with  accuracy  and  care  and  broadly 
enough  so  that  no  question  may  arise  as  to  the  scope 
of  the  corporation.  This  clause  imparts  vitality  to 
the  organization  and  endues  it  with  the  power  which 
is  essential  to  the  accomplishment  of  the  object  for 
which  it  is  created.  The  other  articles  in  the  certifi- 
cate of  incorporation,  relating  to  name,  location, 
authorized  capital  stock,  amount  of  capital  stock  with 
which  business  is  to  commence,  and  the  duration  of 
the  corporation,  do  not  require  any  especial  mention. 

Sec.  64.  Certificate  may  contain  additional  pro- 
visions. The  certificate  of  incorporation  may 
also  contain  any  lawful  provisions  which  the 
incorporators  may  choose  to  insert  for  the 
regulation  of  the  business  of  the  corporation 
or  for  defining  and  regulating  the  powers  of  the 


OF  Connecticut  109 

corporation,  its  officers,  directors,  and  stock- 
holders or  any  class  of  stockholders. 

See  Butler,  Rec'r,  vs.  Beach,  82  Conn.  417  at 
421. 

Sec.  65.  Evidence  of  corporate  existence.  Upon 
the  approval  of  the  certificate  of  incorporation 
by  the  secretary  of  the  state,  corporate  exist- 
ence shall  begin.  A  copy  of  such  certificate 
and  approval,  duly  certified  by  the  secretary 
of  the  state  under  his  hand  and  the  seal  of  the 
state,  shall  be  prima  facie  evidence  of  the  legal 
existence  of  any  such  corporation. 

Sec.  66.  Power  of  incorporators.  After  the 
approval  of  the  certificate  of  incorporation  as 
aforesaid  and  until  the  directors  are  elected,  the 
incorporators  shall  have  charge  of  the  affairs 
of  the  corporation,  and  may  take  such  steps  as 
are  necessary  or  proper  to  obtain  subscriptions 
to  its  stock. 

Sec.  67.  Call  of  first  meeting ;  waiver.  A  ma- 
jority of  the  incorporators  shall  call  the  first 
meeting  of  the  corporation,  at  such  time  and 
place  as  they  may  designate,  by  a  notice  pub- 
lished twice,  at  least  seven  days  before  the  time 
designated,  in  a  newspaper  in  this  state  having 
a  circulation  in  the  town  in  which  the  corpora- 
tion is  located;  but  such  notice  may  be  waived 
by  a  writing  signed  by  all  the  subscribers  to  the 


110  The  Corporation  Act 

capital  stock  and  a  majority  of  the  incorpora- 
tors, specifying  the  time  and  place  for  said 
meeting,  which  waiver  shall  be  recorded  at 
length  upon  the  records  of  the  corporation. 

Sec.  68.     Organization ;  adoption  of  by-laws.    At 

such  meeting,  including  adjournments  thereof, 
the  subscribers  for  stock  who  are  present  in 
person  or  by  attorney  shall  perfect  an  organi- 
zation by  the  choice  of  a  temporary  clerk  and 
the  election  by  ballot  of  three  or  more  directors 
who  are  subscribers  for  stock,  and  shall  adopt 
by-laws  for  the  regulation  of  the  affairs  of  the 
corporation.  Such  subscribers  may  also  trans- 
act any  other  business;  provided,  that  due 
notice  thereof  has  been  given  in  the  call  for 
such  meeting  or  has  been  expressly  waived. 

Sec.  68b.  Unless  the  certificate  of  organiza- 
tion required  by  section  69  is  filed  within  two 
years  after  the  filing  of  the  certificate  of  incor- 
poration, such  certificate  of  incorporation  shall 
be  void.  The  provisions  of  this  section  shall 
apply  to  all  certificates  of  incorporation,  filed 
prior  to  the  going  into  effect  hereof,  under 
which  organization  shall  not  have  been  per- 
fected, and  for  the  purpose  hereof  certificates 
of  organization  thereunder  may  be  filed  at  any 
time  within  two  years  after  this  section  shall  go 
into  effect. 


OF  Connecticut  111 


NOTES. 

The  word  ' '  organize ' '  as  used  in  railroad  and  other 
charters  ordinarily  signifies  the  choice  and  qualifi- 
cation of  all  necessary  officers  for  the  transaction  of 
business  of  the  corporation.  New  Haven  &  Derby 
R,  R.  Co.  vs.  Chapman,  38  Conn.  56. 

The  stockholders  of  a  joint  stock  company,  organ- 
ized under  the  corporation  act  of  1901  (which  is  in 
this  respect  substantially  the  same  at  the  present 
time),  have  the  power  at  a  special  meeting  duly  called 
for  that  purpose,  to  amend  the  by-laws  so  as  to  in- 
crease the  number  of  directors  and  alter  the  date 
fixed  for  the  annual  meeting;  and,  having  adopted 
such  amendments,  the  stockholders  may  proceed  at 
the  same  meeting  to  the  election  of  the  additional 
directors  for  a  term  of  one  year.  The  Gold  Bluff 
Mining  &  Lumber  Corporation  vs.  Whitlock  et  al.,  75 
Conn.  669. 

By-laws. 

It  is  neither  practical  nor  within  the  scope  of  this 
work  to  treat  in  any  exhaustive  manner  the  subject  of 
the  by-laws  of  a  corporation.  What  follows  is  merely 
a  brief  resume  of  the  general  principles  governing  the 
adoption  of  by-laws. 

All  by-laws  must  be  reasonable ;  that  is,  they  must 
not  be  oppressive  or  unequal,  and  if  oppressive  or  un- 
equal they  are  void.  They  must  not  interfere  with 
the  vested  and  substantial  rights  of  the  stockholders ; 
and  they  must  not  be  contrary  to  public  policy  or  the 
established  laws  of  the  land. 

A  by-law  which  requires  the  consent  of  all  the 
stockholders  to  a  transfer  of  the  stock  of  any  member 
of  the  corporation  would  be  void  as  against  public 
policy.  So  a  by-law  is  void  as  against  third  persons, 
which  requires  the  approval  of  directors  to  a  transfer 
of  stock;  or  one  which  requires  the  approval  of  the 
president  thereto. 


112  The  Cokporation  Act 

A  stockholder  is  chargeable  with  notice  of  the  by- 
laws. 

The  same  body  in  a  corporation  which  has  the 
power  to  make  by-laws  has  the  power  to  repeal  them. 
But  the  directors'  power  to  amend  or  repeal  cannot 
be  used  to  amend  or  repeal  any  by-law  intended  as 
a  limitation  of  their  powers. 

The  power  to  elect  officers  (usually  conferred  by  the 
by-laws)  implies  the  power  to  accept  their  resignation 
and  to  remove  them  for  cause.  The  officer  sought  to 
be  removed  for  cause  is  entitled  to  notice  of  the  inten- 
tion to  remove  him  and  the  grounds,  and  is  entitled 
to  an  opportunity  to  make  a  defense. 

An  extended  discussion  of  the  subject  of  by-laws  is 
contained  in  Cook  on  Corporations,  6th  Ed.,  Vol.  1, 
§  4  a,  note,  to  which  the  reader  is  referred. 

Meetings  op  Directors. 

If  regular  business  only  is  to  come  before  the  meet- 
ing, no  notice  is  required  to  be  given,  as  directors  are 
presumed  to  know  when  and  where  the  meetings  are 
to  be  held  and  what  the  general  business  of  the  cor- 
poration is.  Notice  must  be  given  if  any  special  busi- 
ness is  to  come  before  the  regular  meeting,  and  such 
notice  should  specify  the  special  business  and  the  time 
and  place  of  holding  the  meeting. 

Notice  should  also  be  given  of  any  special  meeting 
and  of  the  business  to  come  before  it.  Such  notice 
should  show  that  it  is  given  by  some  one  with 
authority  to  give  it. 

Business  may  be  transacted  without  any  previous 
notice  when  the  directors,  happening  to  be  together, 
agree  to  hold  a  meeting  at  once  for  that  purpose. 

Sec.  69.  Commencement  of  business;  certificate 
of  organization.  No  such  corporation  shall 
commence  business  until  the  amount  of  capi- 
tal specified  in  its  certificate  of  incorpora- 
tion as  the  amount  of  capital  with  which  it  will 


OF  Connecticut  113 

commence  business  has  been  paid  in;  nor  until 
its  directors  and  officers  have  been  duly  elected 
and  its  by-laws  adopted ;  nor  until  a  majority  of 
its  directors  have  caused  to  be  filed  a  certificate 
of  organization  setting  forth:  (1)  The  amount 
of  each  class  of  stock  subscribed  for:  (2)  The 
amount  paid  thereon  in  cash:  (3)  The  amount 
paid  thereon  in  property  other  than  cash:  (4) 
The  amount  paid  on  each  share  of  stock  which 
is  not  paid  for  in  full :  (5)  The  name,  residence, 
and  address  of  each  of  the  original  subscribers, 
with  the  number  and  class  of  shares  subscribed 
for  by  each :  (6)  That  the  directors  and  officers 
of  the  corporation  have  been  duly  elected  and 
its  by-laws  adopted:  (7)  The  name,  residence, 
and  post  office  address  of  each  of  the  officers 
and  directors :  (8)  The  location  of  its  principal 
office  in  this  state,  with  the  street  and  number, 
if  any  there  be,  and  the  name  of  the  agent  or 
person  in  charge  thereof  upon  whom  process 
against  the  corporation  may  be  served.  A 
copy  of  such  certificate,  duly  approved  by 
the  secretary  of  the  state  and  certified  under 
his  hand  and  the  seal  of  the  state,  shall  be 
prima  facie  evidence  that  such  corporation  has 
been  duly  organized  and  is  duly  authorized  to 
exercise  all  of  its  corporate  powers. 

NOTES. 

The  state  alone  has  the  right  to  determine  through 
its  courts  whether  the  conditions  upon  which  a  charter 


114  The  Corpokation  Act 

was  granted  to  a  corporation  have  been  complied  with. 
New  Orleans  Debenture  Co.  vs.  Louisiana,  180  U.  S. 
320. 

After  the  certificate  of  organization  is  filed  the 
burden  is  on  the  stockholder  desiring  to  show  that 
the  organization  is  defective.  Wood  et  als.  vs.  Wiley 
Construction  Co.,  56  Conn.  87. 

The  directors  who  sign  the  certificate  are  estopped 
to  deny  its  recitals.  Canfield,  Trustee,  vs.  Gregory, 
66  Conn.  9. 

A  corporation  has  power  when  fully  organized  to 
ratify  a  contract  made  by  its  promoters  before  its 
organization,  when  it  is  one  within  the  purposes  for 
which  the  corporation  was  organized  and  appears  to 
be  a  reasonable  means  for  carrying  out  those  pur- 
poses. Ratification  relates  back  to  the  execution  of 
the  contract,  and  renders  it  obligatory  from  the  out- 
set. Stanton  et  al.  vs.  N.  Y.  &  B.  R.  R.  Co.  et  als., 
59  Conn.  272. 

A  corporation  is  in  existence  for  some  purposes 
before  it  can  commence  business.  Canfield,  Trustee, 
vs.  Gregory,  66  Conn.  9  at  23. 

A  corporation  may  be  so  defectively  and  illegally 
organized  and  conducted  as  to  become  a  partnership. 
But  to  make  a  stockholder  liable  as  a  partner,  his 
participation  in  the  wrongdoing  must  be  shown.  The 
mere  holding  of  a  certificate  of  stock  is  not  enough, 
Stafford  Bank  vs.  Palmer  et  als.,  47  Conn.  443. 

If  individuals  who  subscribe  in  form  for  shares  do 
not  complete  what  they  in  good  faith  attempted, 
namely,  the  creation  of  a  corporation,  they  remain 
unincorporated  persons  associated  in  business.  New 
Haven  Wire  Co.  Cases,  57  Conn.  352,  394. 

The  agreement  of  a  contractor  to  take  stock  in  the 
company  as  payment  for  work  done,  is  not  a  sub- 
scription which  can  be  included  in  the  amount  which 
must  be  subscribed  before  organization  can  be  com- 
menced. N.  Y.,  Hous.  &  N.  R.  R.  Co.  vs.  Hunt,  39 
Conn.  75. 

A  de  facto  corporation  can  incur  liabilities  which 


OF  Connecticut  115 

do  not  bind  its  organizers  in  their  individual  capaci- 
ties, and  from  which  it  cannot  escape  by  the  appoint- 
ment of  a  receiver.  Lamkin  vs.  Baldwin  &  Lamkin 
Co.,  72  Conn.  57. 

A  company,  after  incorporation,  upon  discovery  of 
fraud  practised  on  it  by  its  promoters,  may  sue  and 
recover  from  them  the  secret  profits  obtained  in  the 
transaction,  though  no  offer  of  rescission  is  made  by 
the  company,  and  notwithstanding  the  property  pur- 
chased is  worth  as  much  or  more  than  was  paid  for  it. 
Yale  Gas  Stove  Co.  vs.  Wilcox,  64  Conn.  101.  See 
also  Stamford  Trust  Co.  vs.  Yale  &  Towne  Mfg.  Co., 
83  Conn.  48. 

A  defect  in  the  organization  of  a  corporation  does 
not  prevent  it  from  being  a  corporation  de  facto,  nor 
disqualify  it  from  acquiring,  holding  and  conveying 
real  estate.  New  York,  Bridgeport  &  Eastern  R.  R. 
Co.  vs.  Motil,  81  Conn.  466. 

Sec.  70.  Officers.  The  directors  of  every 
corporation  shall  choose  from  among  their 
number  a  president  and  shall  appoint  a  treas- 
urer, a  secretary,  and  such  other  officers  as  the 
by-laws  shall  prescribe.  The  same  person  may 
fill  the  offices  of  president  and  treasurer  or  of 
secretary  and  treasurer. 

Sec.  71.  Issue  of  additional  stock.  Every  cor- 
poration may,  at  any  meeting  warned  and  held 
for  that  purpose,  empower  its  directors  to  issue 
shares  of  its  unissued  authorized  capital  stock. 
At  the  time  for  the  filing  of  its  next  annual 
report  after  the  issue  of  any  such  shares,  a 
majority  of  the  directors  shall  make  and  file  a 
certificate  setting  forth  the  facts  relating  to 


116  The  Cokpokation  Act 

such  issue  similar  to  the  facts  relating  to  the 
original  issue  of  stock  required  by  subdivisions 
(1)  to  (5),  inclusive,  of  section  69  of  this  act. 

Sec.  72.  Surrender  of  rights  before  beginning 
business.  At  any  time  before  the  payment  of 
any  part  of  the  subscriptions  to  capital  stock 
and  before  the  commencement  of  business,  the 
incorporators,  and  the  subscribers  for  stock,  if 
any,  may  surrender  the  corporate  rights  and 
franchises  of  any  corporation  by  filing  a  cer- 
tificate that  no  part  of  such  subscription  has 
been  paid,  that  such  business  has  not  been  com- 
menced, that  no  debts  have  been  incurred  which 
are  unpaid,  and  that  they  surrender  all  rights 
and  franchises  of  such  corporation.  When  such 
certificate  has  been  examined  and  approved  by 
the  secretary  of  the  state,  the  existence  of  such 
corporation  shall  terminate. 

Sec.  73.  Amendment  of  certificate  of  incorpora- 
tion before  commencing  business.  At  any  time 
before  the  filing  of  the  certificate  of  organiza- 
tion the  incorporators  of  any  corporation  may 
make  such  amendments,  changes,  and  altera- 
tions in  its  certificate  of  incorporation  as  may 
be  desired;  provided,  that  the  subject-matter 
of  such  changes  could  have  been  lawfully  in- 
serted in  an  original  certificate  of  incorpora- 
tion. No  change,  alteration,  or  amendment 
shall  be  valid,  unless  approved  in  writing  by  all 


OF  Connecticut  117 

of  the  subscribers,  if  any,  to  the  capital  stock 
of  such  corporation,  nor  unless  a  certificate, 
setting  forth  such  amendments,  changes,  or 
alterations  and  stating  that  the  same  has  been 
duly  approved  by  the  subscribers,  if  any,  shall 
be  made  and  filed  by  all  of  the  incorporators. 

Sec.  74.  Changes  in  certificates  of  incorporation. 
Every  corporation  may  change  its  name,  the 
nature  of  its  business,  and  its  location;  may 
increase  or  reduce  the  amount  of  its  authorized 
capital  stock;  may  create  one  or  more  classes 
of  stock;  and  may  make  such  other  amend- 
ments, changes,  and  alterations  in  its  certificate 
of  incorporation  as  may  be  desired;  provided, 
that  the  subject-matter  of  such  changes,  amend- 
ments, and  alterations  could  have  been  lawfully 
inserted  in  an  original  certificate  of  incorpora- 
tion. No  such  change,  alteration,  or  amend- 
ment shall  be  valid  unless  approved  by  a  vote 
of  two-thirds  of  all  of  the  outstanding  stock  of 
each  class  at  a  meeting  of  the  stockholders  duly 
called  to  consider  such  amendment,  change,  or 
alteration,  nor  unless  a  certificate,  setting  forth 
such  amendments,  changes,  or  alterations  and 
stating  that  the  same  have  been  duly  adopted 
by  the  stockholders,  shall  be  made  and  filed  by 
a  majority  of  the  directors. 

Sec.  75.  Similar  corporations  may  consolidate. 
Any    two    or    more    corporations    which    are 


118  The  Corporation  Act 

carrying  on  business  of  the  same  or  a  similar 
nature  may  merge  or  consolidate  into  a  single 
corporation. 

Sec.  76.  Directors'  agreement  as  to  terms  of  con- 
solidation. The  directors  of  the  several  cor- 
porations proposing  to  merge  or  consolidate 
may  enter  into  an  agreement,  signed  by  them 
and  under  the  corporate  seals  of  the  respective 
corporations,  prescribing  the  terms  and  condi- 
tions of  such  proposed  consolidation  and  stat- 
ing the  name  of  the  consolidated  corporation, 
the  number,  names,  and  places  of  residence  of 
its  first  directors,  the  number  of  shares  of  its 
capital  stock  and  the  classes  thereof  and  the 
amount  or  par  value  of  each  share  thereof,  and 
the  manner  of  converting  the  shares  of  capital 
stock  of  each  of  the  old  corporations  into  shares 
of  the  capital  stock  of  the  consolidated  corpora- 
tion, together  with  such  other  provisions  as  are 
required  to  be  set  forth  in  an  original  certificate 
of  incorporation  and  any  other  provisions 
necessary  to  carry  such  proposed  consolidation 
into  effect. 

Sec.  77.     Stockholders  to  vote  upon  consolidation. 

Such  agreement  shall  be  submitted  to  the  stock- 
holders of  each  of  such  merging  or  consolidat- 
ing corporations,  separately,  at  a  meeting 
thereof  to  be  called  for  the  purpose  of  consider- 
ing the  same,  and  twenty  days'  notice  of  the 


OF  Connecticut  119 

time,  place,  and  object  of  such  meeting  shall  be 
mailed  to  the  last  known  post  office  address  of 
each  of  such  stockholders,  and  such  notice  shall 
be  published  once  in  each  week  for  three  suc- 
cessive weeks  in  one  or  more  newspapers  of 
this  state  having  a  circulation  in  the  towns  in 
which  such  corporations  are  respectively 
located.  At  such  stockholders'  meetings,  if 
two-thirds  of  all  the  outstanding  stock  of  each 
class  shall  vote  to  approve  such  merger  or  con- 
solidation, the  facts  shall  be  certified  upon  such 
agreement  by  the  secretaries  of  the  respective 
corporations  under  the  seals  thereof,  and  such 
agreement  so  adopted  and  certified  shall  be  filed 
in  the  office  of  the  secretary  of  the  state,  who 
shall,  if  the  same  conforms  to  the  provisions  of 
this  chapter,  indorse  the  same  *^  Approved, '^ 
with  his  name  and  official  title;  and  a  copy  of 
such  agreement,  certificate,  and  approval,  duly 
certified  by  the  secretary  of  the  state  under  his 
hand  and  the  seal  of  the  state,  shall  be  prima 
facie  evidence  of  the  facts  set  forth  in  such 
agreement  and  certificate  and  of  the  legal  exist- 
ence and  organization  of  such  consolidated 
corporation  and  that  it  is  duly  authorized  to 
exercise  all  of  its  corporate  powers. 

Sec.  78.  Rights,  duties,  and  liabilities  of  con- 
solidated corporations.  Upon  the  completion  of 
such  consolidation,  the  several  corporations 
shall  become  a  corporation  by  the  name  pro- 


120  The  Cokporation  Act 

vided  in  such  agreement,  and  shall  possess  all 
the  rights,  privileges,  powers,  and  franchises  of 
each  of  the  consolidating  corporations ;  and  all 
property,  real,  personal,  and  mixed,  and  all 
debts  due  to  them  on  whatever  account,  shall  be 
vested  in  the  consolidated  corporation;  and  all 
rights  of  creditors  and  all  liens  upon  the  prop- 
erty of  either  of  such  consolidating  corpora- 
tions shall  be  preserved  unimpaired,  and  the 
respective  corporations  shall  continue  in  exist- 
ence so  far  as  may  be  necessary  to  preserve  the 
same;  and  all  debts,  liabilities,  and  duties  of 
either  of  such  consolidating  corporations  shall 
thenceforth  attach  to  the  consolidated  corpora- 
tion, and  may  be  enforced  against  it  to  the  same 
extent  as  if  they  had  been  incurred  or  con- 
tracted by  it.  An  amount  of  the  stock  of  the 
consolidated  corporation  equivalent  to  the 
amount  of  the  stock  of  the  merged  corporations 
on  which  a  franchise  tax  has  been  paid  shall  be 
exempt  from  taxation  under  section  61  of  this 
act. 

NOTE. 

A  corporation  which  has  transferred  all  its  assets 
to  another,  upon  the  agreement  of  the  second  to  pay 
the  debts  of  the  first,  can  proceed  in  equity  to  compel 
the  performance  of  the  agreement;  and  that  right 
constitutes  an  asset  which  its  creditors  can  pursue  in 
equity.  If  the  corporation  has  been  improperly  dis- 
solved, the  re-opening  of  the  judgment  of  dissolution, 
so  that  the  company  or  its  receiver  may  enforce  the 
agreement  for  the  benefit  of  its  creditors,  is  an  appro- 


OF  Connecticut  121 

priate  remedy.     Sullivan   County  Railroad   Co.  vs. 
Connecticut  River  Lumber  Co.  et  al.,  76  Conn.  464. 

Sec.  79.  Remedy  of  aggrieved  stockholder. 
Any  stockholder  in  any  corporation  consolidat- 
ing as  aforesaid  who,  at  the  time  of  such  con- 
solidation, objected  thereto  in  writing,  may, 
within  ten  days  after  the  agreement  of  consoli- 
dation has  been  filed  for  record  in  the  office  of 
the  secretary  of  the  state,  demand  in  writing 
from  the  consolidated  corporation  payment  for 
his  stock;  and  such  corporation  shall,  within 
three  months  thereafter,  pay  him  the  value  of 
his  stock  at  the  date  of  such  consolidation.  In 
case  of  disagreement  as  to  the  value  thereof, 
such  value  shall  be  ascertained  by  three  dis- 
interested persons  to  be  chosen,  one  by  the 
stockholder,  one  by  the  directors  of  the  consoli- 
dated corporation,  and  the  third  by  the  two  thus 
selected,  and,  in  case  their  award  is  not  paid 
within  sixty  days  from  its  date,  it  shall  become 
a  debt  of  such  consolidated  corporation  and 
may  be  collected  as  such.  On  receiving  pay- 
ment of  the  amount  awarded,  such  stockholder 
shall  transfer  his  stock  to  the  consolidated  cor- 
poration, which  shall  dispose  of  it  on  the  best 
terms  obtainable. 


122  The  Cokporation  Act 

PART  IV. 

Foreign  Corporations. 

Sec.  80.  Meaning  of  ^ ^foreign  corporation.*' 
Unless  otherwise  expressly  provided,  the  term 
*^ foreign  corporation"  shall  mean  every  cor- 
poration not  organized  under  the  laws  of  this 
state. 

Sec.  81.  Powers  and  limitations.  Any  foreign 
corporation  may  purchase,  hold,  mortgage, 
lease,  sell,  and  convey  real  and  personal  estate 
in  this  state  for  its  lawful  uses  and  purposes, 
and  such  real  estate  and  other  property  as  it 
may  acquire,  by  way  of  foreclosure  or  other- 
wise, in  payment  of  debts  due  such  corporation ; 
but  no  foreign  corporation  belonging  to  any  of 
the  classes  excepted  in  section  62  of  this  act 
shall  engage  in  or  continue,  in  this  state,  the 
business  authorized  by  its  charter  or  the  laws 
of  the  state  under  which  it  was  organized, 
unless  empowered  so  to  do  by  some  general  or 
special  law  of  this  state,  except  for  the  purpose 
of  carrying  out  and  renewing  existing  contracts 
heretofore  made. 

NOTES. 

For  general  powers  of  domestic  corporations  see 
§  3,  supra,  pages  4,  5. 

For  powers  of  domestic  corporations  organized 
under  Corporation  Act  of  1901,  see  §  59,  supra,  page 
100. 


OF  Connecticut  123 

For  powers  of  Connecticut  corporations  to  transact 
business  outside  the  state,  see  §  4,  supra,  page  18. 

Power  of  corporations  to  act  as  Executors  or 
Trustees  under  Wills  in  this  State.  By  Public  Acts  of 
1903,  Chap.  131,  it  is  provided  as  follows: 

^^  Section  1.     Any  foreign   corporation  authorized 
by  its  charter  to   act  as  executor  or 
trustee  in  the  State  where  it  is  char-    ^^^^J^^^V,^^ 

corporation  may 

tered,  and  named  as  executor  or  trustee    act  as  executor. 
in  the  will  of  any  resident  of  this  state, 
may  qualify  and  act  as  such  executor  or  testamentary 
trustee  in  this  state. 

^'Sec.  2.  No  such  corporation  shall  act  in  such 
capacity  until  it  shall  have  appointed  in  writing  the 
secretary  of  the  state  and  his  successors  in  office  to  he 
its  attorney,  upon  whom  all  process  in 
any  action  or  proceeding  against  it  may  ^o  appoint  sec- 
he  served;  and  in  such  writing  such  attome^^  ^^^  ^*^^^' 
corporation  shall  agree  that  any  process 
against  it  which  is  served  on  such  secretary  shall  be 
of  the  same  legal  force  and  validity  as  if  served  on 
the  said  corporation,  and  that  such  appointment  shall 
continue  so  long  as  any  liability  remains  outstanding 
against  the  corporation  in  this  state. 

''Sec.  3.     The  court  of  probate  having  jurisdiction 
may,  in  the  discretion  of  said  court, 
require  said  corporation  to  give  bond    i^ayrlqui^rTboid. 
for  the  performance  of  such  trust,  un- 
less otherwise  provided  in  such  will. 

"Sec.  4.  This  act  shall  take  effect  from  its  pas- 
sage, and  shall  apply  to  all  wills  and    ^     ,...„. 

^,.^.,  7  •   7     7  1  1     n    1  To  what  wills  to 

codicils  which  have  been  or  shall  here-         apply. 
after  be  executed.' ' 

A  state  may  in  general  impose  such  conditions  as 
it  pleases  upon  the  right  of  a  corporation  chartered 
by  another  state  to  do  business  within  the  borders  of 


124  The  Cokporation  Act 

the  former,  Paul  vs.  Virginia,  8  Wall.  (U.  S.)  168; 
or  to  become  one  of  the  elements  of  a  consolidated 
corporation  organized  under  the  laws  of  the  former, 
Ashley  vs.  Ryan,  153  U.  S.  436;  since  a  corporation 
is  not  a  '^ citizen"  within  the  provision  of  the  XlVth 
Amendment  declaring  that  the  citizens  of  each  state 
shall  be  entitled  to  all  privileges  and  immunities  of 
citizens  in  the  several  states.  Orient  Insurance  Co. 
vs.  Daggs,  172  U.  S.  557;  Pembina  Mining  Co.  vs. 
Pennsylvania,  125  U.  S.  181.  But  conditions  cannot 
be  placed  upon  the  doing  of  a  business  which  is  strictly 
interstate  or  foreign  commerce,  Pembina  Mining  Co. 
vs.  Pennsylvania,  supra,  and  particularly  the  right 
to  carry  on  such  interstate  or  foreign  commerce 
within  the  state  cannot  be  conditioned  upon  an  agree- 
ment not  to  remove  a  suit  against  it  from  the  state 
to  the  Federal  courts.  So.  Pac.  Co.  vs.  Denton,  146 
U.  S.  207 ;  and  the  power  of  a  State  to  impose  condir 
tions  upon  foreign  corporations,  however,  cannot  be 
exercised  to  discharge  citizens  of  that  state  from  their 
contract  obligations  to  such  corporations.  Bedford 
vs.  Eastern  Bldg.  &  Loan  Assn.,  181  U.  S.  227. 

The  power  of  a  State  over  foreign  corporations  is 
not  less  in  any  respect  than  over  its  own  except  as 
it  is  limited  by  the  United  States  Constitution  and 
by  its  inability  to  amend  the  charters  of  such  foreign 
corporations.  See  N.  Y.  Life  Insurance  Co.  vs. 
Cravens,  178  U.  S.  389.  The  mere  doing  of  one  act 
of  business  wdthin  a  state  by  a  foreign  corporation, 
however,  with  no  purpose  of  doing  other  acts  there, 
does  not  bring  the  corporation  within  a  statute  for- 
bidding foreign  corporations  to  do  business  without 
filing  certain  certificates,  so  as  to  constitute  such 
failure  a  defense  to  a  suit  brought  by  such  corpora- 
tion on  a  single  contract  thus  made.  Cooper  Mfg.  Co. 
vs.  Ferguson,  113  U.  S.  727. 

In  general  the  rights  and  liabilities  of  stockholders 
as  between  themselves  and  the  corporation  and  credit- 
ors of  the  corporation  are  determined  by  the  laws  of 
the  state  of  incorporation.     See  Lewisohn  et  al.  vs. 


OF  Connecticut  125 

Stoddard  et  als.,  78  Conn.  575;  Converse,  Receiver, 
vs.  JEtna  Nat.  Bank,  79  Conn.  163,  affirmed  212 
U.  S.  567. 

Sec.  82.  Charter  or  certificate  of  incorporation  to 
be  filed.  Every  foreign  corporation,  except 
insurance  and  surety  companies,  building  and 
loan  associations,  and  investment  companies 
within  the  provisions  of  section  41  charter  or  cer- 
of  this  act,  shall,  before  transacting  ^'^^^^.^  °^  ^"^°'^- 

'  '  *^     poration    to    be 

business  in  this  state,  file  in  the  filed. 
office  of  the  secretary  of  the  state  a    as  amended 
certified  copy  of  its  charter  or  cer-  J^^f.\^l^'^' 

■■^•'  Public  Acts  of 

tificate  of  incorporation,  together  1907.  ch.  eo. 
with  a  statement,  signed  and  sworn  to  by  its 
president,  treasurer,  and  a  majority  of  its  di- 
rectors, showing  the  amount  of  its  authorized 
capital  stock  and  the  amount  thereof  which  has 
been  paid  in,  and,  if  any  part  of  such  payment 
has  been  made  otherwise  than  in  cash,  such 
statement  shall  set  forth  the  particulars  thereof. 

Sec.  83.  Secretary  of  the  state  to  be  resident 
attorney.  Every  foreign  corporation  with  an 
office  or  place  of  business  in  this  state,  except 
insurance  companies,  surety  companies,  and 
building  and  loan  associations,  shall,  before 
doing  business  in  this  state,  appoint  in  writing 
the  secretary  of  the  state  and  his  successors  in 
office  to  be  its  attorney,  upon  whom  all  process 
in  any  action  or  proceeding  against  it  may  be 
served;  and  in  such  writing  such  corporation 


126  The  Cokporation  Act 

shall  agree  that  any  process  against  it  which  is 
served  on  such  secretary  shall  be  of  the  same 
legal  force  and  validity  as  if  served  on  the  cor- 
poration, and  that  such  appointment  shall  con- 
tinue in  force  as  long  as  any  liability  remains 
outstanding  against  the  corporation  in  this 
state.  Such  written  appointment  shall  be 
acknowledged  before  some  officer  authorized  to 
take  acknowledgments  of  deeds  and  shall  be 
filed  in  the  office  of  said  secretary,  and  copies 
certified  by  him  shall  be  sufficient  evidence  of 
such  appointment  and  agreement.  Service 
upon  said  attorney  shall  be  sufficient  service 
upon  the  principal,  and  may  be  made  by  leaving 
a  duly  attested  copy  of  the  process  with  the 
secretary  of  the  state  or  at  his  office. 

Sec.  84.  Duty  of  secretary  when  served  with 
process  ;  fee ;  record.  When  legal  process 
against  any  corporation  mentioned  in  section  83 
of  this  act  is  served  upon  the  secretary  of  the 
state,  he  shall  immediately  notify  the  corpora- 
tion thereof  by  mail,  and  shall,  within  two  days 
after  such  service,  forward  in  the  same  manner 
a  copy  of  the  process  served  upon  him  to  such 
corporation,  or  to  any  person  designated  by 
such  corporation  in  writing.  The  plaintiff  in 
the  process  so  served  shall  pay  said  secretary 
at  the  time  of  such  service  a  fee  of  twenty-five 
cents  for  each  page  of  process,  said  fee  in  no 
case  to  be  less  than  two  dollars,  which  shall  be 


OP  Connecticut  127 

recovered  by  him  as  part  of  his  taxable  costs  if 
he  shall  prevail  in  the  suit.  Said  secretary- 
shall  keep  a  record  of  all  process  served  upon 
him,  which  shall  show  the  day  and  hour  when 
such  service  was  made. 

Sec.  85.  Failure  to  file  certificates  and  appoint 
attorney ;  penalty.  Every  officer  of  a  foreign 
corporation  transacting  business  in  this  state 
which  fails  to  comply  with  the  requirements  of 
sections  82  and  83  of  this  act,  and  every  person 
who  transacts  business  in  this  state  as  the  agent 
of  such  delinquent  corporation,  shall  be  fined 
not  more  than  one  thousand  dollars;  but  such 
failure  shall  not  affect  the  validity  of  any  con- 
tract by  or  with  such  corporation.  The  secre- 
tary of  the  state  shall  report  such  failure  to 
the  attorney-general,  who  shall  thereupon  insti- 
tute proceedings  against  such  corporation  to 
restrain  its  further  prosecution  of  business  in 
this  state. 

Sec.  86.  Certificate  of  increase  or  reduction  of 
capital  to  be  filed.  Every  foreign  corporation 
doing  business  in  this  state  shall,  within  thirty 
days  after  an  increase  or  reduction  of  its  capital 
stock,  file  in  the  office  of  the  secretary  of  the 
state  a  certificate  thereof,  substantially  like  that 
required  of  domestic  corporations  organized 
under  the  corporation  act  of  1901  under  like 
conditions. 


128  The  Corpokation  Act 


NOTES. 


For  certificate  of  increase  of  capital  stock  of  spe- 
cially chartered  domestic  corporations  see  §  47,  supra, 
pages  92,  93. 

For  certificate  of  increase  of  capital  stock  of 
domestic  corporations  organized  under  general  laws 
see  §§  73,  74,  supra,  pages  116,  117. 

Sec.  87.  Annual  Reports.  The  president  and 
treasurer  of  every  foreign  corporation  doing 
business  in  this  state,  which  is  not  required  by 
law  to  make  other  annual  returns  in  this  state, 
shall,  annually,  on  or  before  the  fifteenth  day  of 
February  or  August,  make,  sign,  and  swear  to 
and  file  in  the  ofiice  of  the  secretary  of  the  state 
a  certificate  similar  to  the  certificate  required  by 
section  37  of  this  act,  except  that  such  certificate 
need  not  give  the  name  of  the  agent  or  person 
in  charge  of  its  principal  office  upon  whom  pro- 
cess against  the  corporation  may  be  served. 
The  secretary  shall  thereupon  record  such  cer- 
tificate in  a  book  kept  by  him  for  that  purpose 
and  shall  furnish  a  certified  copy  of  such  cer- 
tificate to  the  persons  filing  the  same,  who  shall 
forthwith  cause  such  certified  copy  to  be  re- 
corded in  the  office  of  the  town  clerk  of  the  town 
in  this  state  in  which  such  corporation  has  its 
principal  office  or  place  of  business,  and  said 
town  clerk  shall  record  the  same  in  a  book  kept 
by  him  for  that  purpose.  On  the  fifteenth  day 
of  March  and  September  the  town  clerks  of  the 
several  towns  shall  report  to  the  secretary  of 


OF  Connecticut  129 

the  state  the  names  of  all  corporations  whose 
annual  reports  have  been  filed  for  record  during 
the  preceding  six  months,  in  accordance  with 
the  provisions  of  this  section,  and  the  secretary- 
shall  report  to  the  attorney-general  every  six 
months  the  names  of  all  corporations  which 
have  failed  to  comply  with  the  provisions  of 
this  section,  and  the  attorney-general  shall  col- 
lect all  forfeitures  due  under  this  section. 
Every  corporation  whose  officers  shall  fail  to 
comply  with  the  requirements  of  this  section 
shall  forfeit  to  the  state  one  hundred  dollars 
for  each  failure. 

NOTE. 

For  annual  reports  of  domestic  corporations  having 
capital  stock,  see  §  37,  supra,  page  74.  (And  see  notes 
under  said  section.) 

Sec.  88.  What  penalties  apply  to  foreign  cor- 
porations. All  penalties  and  liabilities  which 
are  imposed  by  the  laws  of  this  state  upon  offi- 
cers, directors,  and  stockholders  of  domestic 
corporations  for  false  and  fraudulent  state- 
ments and  returns,  shall  apply  to  the  officers, 
directors,  and  stockholders  of  foreign  corpora- 
tions doing  business  in  this  state. 

NOTE. 

Dissolution.  A  corporation  can  be  dissolved  only 
by  the  state  which  created  it.  Lewisohn  et  al.  vs. 
Stoddard  et  als.,  78  Conn.  575. 


130  The  Cokpobation  Act 

PART  V. 

COKPOBATIONS  WITHOUT   CAPITAL   StOCK. 

Sec.  89.  Organization.  Any  three  or  more 
persons  may  associate  to  form  a  corporation 
without  capital  stock,  to  promote  or  organization  of 
carry  out  any  lawful  purpose,  other  corporations 

•^  ''  tr       ir  7  without  capital 

than  that  of  a  mercantile  or  manu-  stock. 
facturing  business,  by  signing  and  as  amended 
acknowledging  before  any  officer  pubUcActsof 
authorized  to  take  acknowledg-  i9ii,ch.56. 
ments  of  deeds  and  filing  in  the  office  of  the  sec- 
retary of  the  state  a  certificate  stating:  (1) 
That  they  do  so  associate:  (2)  The  purpose  or 
object  of  the  corporation :  (3)  The  town  in  this 
state  in  which  the  corporation  is  to  be  located. 
The  persons  so  associating  may  also  include  in 
said  certificate  any  other  lawful  provisions  for 
the  regulation  of  the  affairs  of  the  corporation 
and  the  definition  of  its  powers  and  the  powers 
of  its  officers,  directors,  and  incorporators. 
Such  certificate  shall  be  examined  by  the  secre- 
tary of  the  state,  and,  if  he  shall  find  that  it 
conforms  to  law  and  that  the  fee  required  by 
section  4814  of  the  general  statutes  to  be  paid  at 
the  filing  of  such  certificate  has  been  paid,  he 
shall  endorse  thereon  the  word  ^* Approved," 
with  his  name  and  official  title,  and  shall  there- 
upon cause  the  same  to  be  recorded  in  his  office. 


OF  Connecticut  131 

He  shall  then  prepare  a  certified  copy  of  such 
certificate  and  of  his  approval  and  deliver  the 
same  to  one  of  the  persons  so  associated,  who 
shall  forthwith  cause  such  copy  to  be  recorded 
in  the  office  of  the  town  clerk  in  the  town  where 
such  corporation  is  to  be  located.  When  such 
certificate  has  been  duly  approved  and  recorded, 
the  persons  so  associated,  with  such  others  as 
may  be  associated  with  them  or  become  their 
successors  in  such  manner  as  the  by-laws  of  the 
corporation  provide,  shall  be  and  become  a  body 
politic  and  corporate  and  shall  have  all  the 
powers  conferred  upon  corporations  by  section 
3  of  this  act,  and  shall  have  the  same  Power  granted 
power  to  mortgage  its  real  and  per-  to  mortgage reai 

■^  .  .  ^"^  personal  es- 

sonal  estate  and  to  issue  promissory  tate.  and  to  issue 

.  .^  .  T  j»   •      T    T  J.       notes    and    evi- 

notes  or  other  evidences  of  mdebt-  dences  of  indebt- 
edness as  have  corporations  having  ^dness. 
capital  stock  and  organized  under  the  general 
laws  of  this  state,  and  may  receive  property  by 
devise  or  bequest  and  hold  the  same,  so  far  as 
such  property  may  be  necessary  or  proper  to 
enable  such  corporation  to  carry  out  its  pur- 
poses. A  copy  of  the  certificate  filed  in  the 
office  of  the  secretary  of  the  state  and  of  his 
approval,  duly  certified  under  his  hand  and  the 
seal  of  the  state,  shall  be  prima  facie  evidence  of 
the  facts  therein  set  forth  and  of  the  legal  exist- 
ence of  such  corporation  and  of  its  authority  to 
exercise  its  corporate  powers.  Such  corpora- 
tion may  at  any  time  amend  its  original  certifi- 


132  The  Cokpoeation  Act 

cate  of  incorporation  by  a  three-fourths  vote  of 
its  incorporators,  their  associates,  and  succes- 
sors, at  a  meeting  of  the  corporation  duly  called 
to  consider  such  amendment,  and  by  causing  a 
certificate,  duly  attested  by  its  president  and 
secretary,  and  setting  forth  the  fact  that  such 
vote  has  been  passed  and  stating  the  subject- 
matter  of  such  amendment,  to  be  filed,  ap- 
proved, and  recorded  in  the  same  manner  as  the 
original  certificate  of  incorporation. 
This  act  shall  take  effect  from  its  passage. 

NOTES. 

The  Dissolution  of  Corporations  without  Capital 
Stock  is  provided  for  by  Public  Acts  of  1907,  Chap. 
165,  as  follows : 

'^Section  1.     Whenever  the  hoard  of  management 
of    any    corporation    without    capital    stock,    corre- 
sponding in  its  official  relation  to  such  corporation 
with  the  board  of  directors  of  a  corpora- 
tion having  capital  stock,  shall  vote  to    Voluntary  dis- 

,  ..^..^  J  •   ,  •  n     solution   of  cor- 

termmate  its  corporate  existence,  said  poration. 
hoard  of  management  shall  forthwith 
call  a  special  meeting  of  the  members  of  such  corpora- 
tion, to  be  held  not  less  than  thirty  nor  more  than 
forty  days  from  the  date  of  such  call.  The  call  for 
said  meeting  shall  contain  a  copy  of  said  vote,  and 
shall  he  published  once  a  week  for  four  weeks  next 
preceding  such  meeting  in  a  newspaper  published  in 
this  state  and  having  a  circulation  in  the  town  in 
which  such  corporation  is  located,  and  a  copy  of  said 
call  shall  be  sent  by  mail  to  the  last  known  address 
of  each  member  of  the  corporation.  If,  at  such  meet- 
ing of  the  corporation,  three-fourths  in  number  of 
the  members  of  said  corporation  present  and  voting 


OF  Connecticut  133 

at  such  meeting  shall  vote  to  confirm  said  vote  of  the 
hoard  of  management,  said  board  of  management  shall 
proceed  forthwith  to  wind  up  the  affairs  of  the  cor- 
poration; provided,  that,  if  every  member  shall  sign 
and  acknowledge,  before  an  officer  authorized  to  take 
acknowledgments  of  deeds,  an  agreement  among  the 
members  that  the  corporate  existence  of  such  corpora- 
tion shall  be  terminated,  such  vote  of  the  board  of 
management  and  confirming  vote  of  the  members  may 
be  dispensed  with. 

"Sec.  2.  The  board  of  management  of  any  such 
corporation,  the  existence  of  which  is  to  be  terminated 
pursuant  to  the  vote  or  agreement  of  its  members  as 
hereinbefore  provided,  shall  be  trustees 
to  close  up  the  business  of  said  corpora-  ^^^^^  °^  "^a"- 
tion.  They  shall  forthwith  prepare  an  to^A^n?up"bu^- 
inventory  of  its  assets,  make  a  list  of  its  ness. 
creditors,  with  the  amounts  due  to  each, 
and  collect  its  bills  and  accounts  receivable.  They 
shall,  within  two  weeks  after  the  date  of  the  members' 
vote  of  confirmation  or  agreement  to  dissolve  the  cor- 
poration, send  a  written  notice  of  the  proposed  dis- 
solution to  every  known  creditor  of  such  corporation 
warning  him  to  present  his  claim,  and  stating  to  whom 
and  at  what  place  such  claim  may  be  presented,  and 
shall,  in  such  notice,  limit  the  time,  not  less  than  four 
months  after  the  date  of  such  notice,  within  which 
such  claim  shall  be  presented;  they  shall  also  publish, 
in  some  newspaper  published  in  this  state  and  having 
a  circulation  in  the  town  in  which  such  corporation 
is  located,  a  copy  of  such  notice.  Within  one  year 
from  the  date  of  said  members'  vote  or  agreement 
said  trustees  shall  sell  all  of  the  property  of  such  cor- 
poration, except  money  and  uncollected  accounts  in 
litigation,  at  private  sale  or  public  auction,  and,  as 
soon  as  practicable,  said  trustees  shall  pay,  in  full  or 
pro  rata,  all  claims  against  such  corporation  which 
have  been  allowed  by  them  or  which  may  be  found 
to  be  due  by  any  proper  tribunal,  and  shall  distribute 


134  The  Corporation  Act 

the  balance  of  the  assets,  if  any,  pro  rata  among  the 
members  of  said  corporation. 

"Sec.  3.  Said  trustees  may,  in  their  discretion, 
bring  their  application  to  the  superior  court  for  the 
comity  within  which  the  corporation  is  located,  or  to 
any  judge  of  the  superior  court  if  such 
court  is  not  in  session,  setting  forth  the  superior  court!° 
facts  of  such  proposed  dissolution,  and 
praying  the  court,  or  such  judge,  to  limit  a  period 
within  which  all  claims  against  such  corporation  shall 
be  presented,  and  such  court  or  judge  may  make  an 
order  limiting  the  time  within  which  claims  shall  be 
presented,  which  time  shall  not  be  less  than  four 
months  from  the  date  of  such  order;  and  such  trustees 
shall  proceed  to  wind  up  the  affairs  of  the  corpora- 
tion, in  accordance  with  the  provisions  of  section  two 
of  this  act,  under  the  direction  of  the  court,  in  the 
same  manner  as  if  they  were  receivers  of  said  cor- 
poration. The  court  may,  for  cause  shown,  extend 
the  period  within  which  the  trustees  shall  sell  the 
property  of  the  corporation. 

"Sec.  4.  All  claims  not  presented  within  the  time 
limited  in  accordance  with  the  provisions  of  sections 
two  and  three  of  this  act  shall  be  barred, 
and  any  claim  so  presented  and  disal-  ^^fbebarrS^ 
lowed  by  such  trustees  shall  be  barred 
unless  the  owner  thereof  shall  commence  an  action  to 
enforce  the  same  within  four  months  after  such 
trustees  shall  have  given  him  written  notice  of  its 
rejection. 

"Sec.  5.  No  creditor  shall,  by  attachment  or  by 
any  process  or  proceeding,  interfere  with  the  custody, 
control,  or  disposition  of  the  property  of  such  cor- 
poration by  its  board  of  managers  acting 
as  trustees  for  the  winding  up  of  its  cor-  creditors  not  to 
porate  affairs  under  the  provisions  of  f^^^^^i^^f^^^^ 
this  act,  but  any  creditor,  pending  such  erty. 
winding  up,  may  apply  to  the  superior 


OF  Connecticut  135 

court  in  the  county  in  which  the  corporation  is  located, 
or  to  a  judge  thereof  if  such  court  is  not  in  session, 
for  the  appointment  of  a  receiver  of  such  property 
on  the  ground  of  fraud,  mismanagement,  or  incom- 
petency of  such  trustees,  and  such  court  or  judge, 
upon  finding  that  such  trustees  are  incompetent,  or 
have  been  guilty  of  fraud  or  mismanagement  in  the 
discharge  of  their  duties,  shall  appoint  such  receiver, 
and  the  powers  of  such  trustees  shall  thereupon  ter- 
minate. Nothing  herein  contained  shall,  however,  pre- 
vent any  person  from  establishing  any  claim  against 
such  corporation  by  an  action  at  law,  or  prevent  the 
foreclosure  of  any  lien  or  mortgage  existing  at  the 
time  of  such  vote  or  agreement  to  dissolve. 

^'Sec.  6.  Whenever  the  members  of  any  such  cor- 
poration shall,  by  vote  or  written  assent,  agree  to  the 
dissolution  of  such  corporation,  a  majority  of  its  said 
board  of  management  shall  make,  sign, 
and  make  oath  to,  and  file  in  the  office  Certificates  con- 
of  the  secretary  of  the  state,  a  certificate  l^^^'"^^  dissoiu- 
that  such  vote  has  been  duly  passed  or 
such  assent  didy  given,  and  stating  the  address  to 
which  all  claims  against  such  corporation  may  be 
sent;  and  said  secretary  shall  thereupon  record  such 
certificate  in  a  book  kept  by  him  for  that  purpose. 
When  said  board  of  management  has  completed  its 
duties  as  such  trustees,  a  majority  thereof  shall  make, 
sign,  and  make  oath  to,  and  file  in  the  office  of  the 
secretary  of  the  state,  a  further  certificate  stating 
that  said  board  of  management  has  completed  its 
duties  in  winding  up  the  affairs  of  said  corporation, 
and  has  sold  or  collected  all  of  its  assets  and  dis- 
tributed the  same,  stating  the  manner  of  such  dis- 
tribution. The  secretary  shall  examine  the  same 
and,  if  he  finds  that  it  conforms  to  law,  shall  indorse 
thereon  the  word  'Approved,^  with  his  name  and 
official  title,  and  shall  thereupon  record  such  cer- 
tificate in  a  book  kept  by  him  for  that  purpose; 
and  when  such  certificate  has  been  so  approved  by 


136  The  Corporation  Act 

the  secretary  the  existence  of  the  corporation  shall 
terminate. 

^'Sec.  7.     The   existence  of  any  such  corporation 
shall  continue   during   the   proceedings 
for  the  winding  up  of  its  affairs  so  far   Corporate  exist- 

'  ,  i/f/  77.,,  ence  to    be    con- 

as  may  be  necessary  to  enable  it  to  prose-  tinued  for  certain 
cute  and  defend  suits  by  or  against  it,  purposes. 
close  up  its  affairs,  dispose  of  its  prop- 
erty, and  distribute  its  assets/' 


Sec.  90.  By-laws ;  assessments ;  fines.  Any 
corporation  without  capital  stock  may  make  by- 
laws imposing  fines  and  penalties,  and  may  lay 
assessments  or  dues  to  further  the  objects  of 
the  corporation,  either  by  by-laws  adopted  for 
that  purpose  or  by  vote  of  the  members  of  such 
corporation  at  meetings  warned  and  held  for 
that  purpose.  No  such  by-law  shall  be  adopted 
and  no  such  assessment  or  due  shall  be  laid 
except  by  a  two-thirds  vote  of  all  the  members 
of  the  corporation.  No  such  fine,  assessment, 
or  due  shall  exceed  the  sum  of  twenty-five 
dollars.  Such  corporation  may  sue  for  and 
collect  such  fines  and  assessments  and  dues. 

Sec.  91.  Sections  3311  to  3398,  inclusive,  and 
3928  to  3938,  inclusive,  of  the  general  statutes 
and  chapter  69  of  the  public  acts  of  1903  are 
hereby  repealed. 

The  Corporation  Act,  as  originally  enacted, 
was  approved  June  22,  1903. 


OF  Connecticut  137 

NOTES. 

Fees  for  filing,  etc.,  are  covered  by  Gen.  Statutes, 
Rev.  of  1902 : 

**  §  4814.  Corporations  without  capital  stock.  Upon 
the  approval  by  the  secretary  of  the  certificate  of 
organization  of  a  corporation  without  capital  stock 
a  fee  of  ten  dollars  shall  he  paid  by  it  to  the  state 
treasurer.' ' 

Gen.  Statutes,  Rev.  of  1902,  relating  to  salaries  and 
fees  of  various  public  officials,  provides  that  the  Sec- 
retary of  State  shall  receive  the  following  fees : 

''For  filing  or  recording  any  documents  required 
to  be  filed  or  recorded^  otherwise  than  for  the  state, 
and  for  certified  copies,  except  resolutions  relating  to 
payment  from  the  treasury,  when  not  otherwise  spe- 
cially provided  for,  one  dollar  for  filing,  and  for  re- 
cording, one  dollar  for  two  pages  or  less,  and  for  each 
additional  page  at  the  rate  of  fifty  cents  per  page; 
for  preparing  forms  for  certificates  and  returns  of 
corporations,  for  recording  same,  and  for  copies  of 
certificate,  fifty  cents  for  each  page,  but  in  no  case 
less  than  one  dollar;  for  filing  copy  of  charter  or 
certificate  of  organization  of  foreign  corporation,  ten 
dollars,  and  for  filing  the  statement  required  from 
such  corporation,  five  dollars;  for  secretary's  certi- 
ficate with  the  state  seal  impressed  thereon,  fifty  cents; 
for  certificate  of  record  of  trade  union  label,  one 
dollar." 

Promoters. 

A  promoter  has  been  defined  to  be  a  person  who 
organizes  a  corporation.  It  is  a  business  term  ''use- 
fully summing  up  in  a  single  word  a  number  of  busi- 
ness operations  familiar  to  the  commercial  world  by 
which  a  corporation  is  generally  brought  into  exist- 
ence." It  is  well  settled  that  promoters  occupy  a 
fiduciary  relation  towards  the  corporation  whose 
organization  they  are  promoting.  Yale  Gas  Stove  Co. 
vs.  Wilcox,  64  Conn.  101. 


138  The  Coepokation  Act 

Promoters  of  a  corporation  are  bound  to  the  exer- 
cise of  good  faith  toward  all  the  stockholders,  to  dis- 
close all  the  facts  relating  to  the  property,  and  are 
precluded  from  taking  a  secret  advantage  of  other 
stockholders.  Dickerman  vs.  Northern  Trust  Co.,  176 
U.  S.  181. 

False  representations  made  to  promoters  and  acted 
on  by  the  corporation,  will,  after  loss,  enable  the  cor- 
poration to  recover.  Scholfield  Gear  &  Pulley  Co.  vs. 
Scholfield,  71  Conn.  1,  14. 

A  corporation  having  accepted  services  incident  to 
its  incorporation  and  organization  may  lawfully 
undertake  to  pay  therefor  and  a  duly  authorized  note 
of  the  corporation  given  for  the  agreed  amount  rests 
upon  a  valid  consideration.  Smith  vs.  New  Hartford 
Water  Co.,  73  Conn:  626. 

Evidence. 

Gen.  Stat,  Rev.  of  1902:  **  §  734-  Disclosure- 
examination  of  officer  of  corporation.  //  a  corporation 
is  party  to  an  action,  the  opposite  party  may  examine 
the  president,  treasurer,  secretary,  clerk,  or  any 
director  or  other  officer  thereof,  in  the  same  manner 
as  if  he  were  a  party  to  the  suit." 

Gen.  Stat,  Rev.  of  1902:**  §699.  Records  of 
public  offices  and  corporations.  The  entries  or  records 
of  all  corporations  and  all  public  offices,  where 
entries  or  records  are  made  of  their  acts,  votes,  and 
proceedings,  by  some  officer  appointed  for  that  pur- 
pose, may  he  proved  by  a  copy  certified  under  the 
hand  of  such  officer,  and  the  seal  of  such  corporation 
or  office  {if  there  he  any);  and  if  any  such  officer 
shall  knowingly  make  a  false  certificate,  he  shall  he 
punished  in  the  same  manner  as  if  guilty  of  perjury." 

Gen.  Stat.,  Rev.  of  1902:  **§  700.  Corporation 
certificates ;  copies  as  prima  facie  evidence.  A  copy 
of  any  certificate  filed  hy  any  corporation  for  record 
in  the  office  of  the  secretary  of  state  in  compliance 


OF  Connecticut  139 

with  the  requirements  of  law  shall,  when  attested  by 
said  secretary  under  his  hand  and  the  seal  of  the 
state,  he  prima  facie  evidence  of  the  facts  set  forth 
therein.'^ 

Rules  under  the  Practice  Act:  *'Sec.  161.  In  an 
action  by  a  corporation,  foreign  or  domestic,  founded 
upon  any  contract,  express  or  implied,  the  defendant 
shall  not,  under  a  general  denial,  be  permitted  to  dis- 
pute, but  shall  be  deemed  to  admit  the  capacity  of 
the  plaintiff  to  make  such  contract." 

Whether  acts  are  in  official  or  individual  capacity. 
Notice  to  an  officer  of  a  corporation,  addressed  to 
him  as  such,  dealing  with  matters  under  his  official 
management,  is  notice  to  the  corporation,  and  the 
parties  sending  it  may  presume,  until  otherwise  in- 
formed, that  the  contents  have  been  made  known  to 
the  corporation.  Smith  vs.  Board  of  Water  Com- 
missioners, 38  Conn.  208  at  219.  See  also  Bridgeport 
Bank  vs.  N.  Y.  &  N.  H.  Railroad  Co.,  30  Conn.  231, 
holding  that  the  knowledge  of  an  agent  obtained 
while  acting  within  the  scope  of  his  official  power  is 
the  knowledge  of  the  corporation,  and  a  fraudulent 
act  of  such  agent  cannot  be  taken  advantage  of  by  the 
corporation.  To  the  same  point  see  Toll  Bridge  Co. 
vs.  Betsworth,  30  Conn.  380.  But  notice  to  an  officer 
must  come  to  him  in  his  official  capacity,  to  become 
notice  to  the  corporation,  and  if  it  comes  to  him  as 
an  individual  merely,  or  in  connection  with  a  matter 
as  to  which  he  has  no  authority,  it  is  not  notice  to  the 
corporation.  See  Farrel  Foundry  vs.  Dart  et  al.,  26 
Conn.  376;  Farmers  &  Citizens'  Bank  vs.  Payne,  25 
Conn.  444. 

Admissions.  The  admissions  of  individual  mem- 
bers of  a  corporation,  or  of  agents  or  officers  not  made 
in  connection  with  any  official  act,  or  in  the  course 
of  duty,  are  not  admissible  against  the  corporation. 
Hartford  Bank  vs.  Hart,  3  Day,  491;  Fairfield 
County    Turnpike    Co.    vs.    Thorp,    13    Conn.    173; 


140  The  Corpokation  Act 

Morse,  Adm.  vs.  Consol.  Ry.  Co.,  81  Conn.  395; 
Starr  Burying  Ground  Assn.  vs.  North  Lane  Ceme- 
tery Assn.,  77  Conn.  83. 

The  president  of  a  railroad  company  may  testify 
as  to  its  intention  in  improving  and  double  tracking 
its  line  without  producing  a  copy  of  a  recorded  vote 
or  other  evidence  of  formal  action  by  its  directors. 
The  rule  as  to  parol  evidence  of  a  corporate  intent 
inconsistent  with  action  which  has  been  taken  and  is 
on  record  has  no  application  to  parol  evidence  as  to 
a  corporate  intent  respecting  action  to  be  taken  in  the 
future.  N.  Y.,  N.  H.  &  H.  R.  R.  Co.  vs.  Offield,  78 
Conn.  1. 

Evidence  that  a  certain  person  was  treasurer  of  a 
Connecticut  corporation  in  1903,  since  when  it  had 
failed  to  file  any  annual  statement  giving  the  names 
of  its  officers  as  required  by  statute,  authorizes  the 
inference  that  he  was  its  treasurer  up  to  the  time  of 
the  hearing  two  or  three  years  later.  Stafford  Springs 
St.  Ry.  Co.  vs.  Middle  River  Mfg.  Co.,  80  Conn.  37. 

When  a  contract  relating  to  the  business  of  a  cor- 
poration bears  the  name  of  the  corporation  as  the  first 
signature,  followed  by  the  names  of  certain  corporate 
officers  with  their  official  titles,  whether  with  or  with- 
out the  preposition  "per"  or  ''by,"  the  corporation 
will  be  regarded  as  the  signer  and  obligor,  and  the 
individuals  will  not  be  obligated,  unless  other  lan- 
guage of  the  writing  or  its  tenor  indicates  a  contrary 
intention.  The  use  of  the  pronoun  ''we"  or  "I"  in 
the  contract,  referring  to  the  obligor,  is  not  suffi- 
cient to  change  this  rule  of  construction.  Jacobs  vs. 
Williams  et  al.,  85  Conn.  215. 


APPENDIX. 


APPENDIX. 


In  the  following  pages  will  be  found  the  more  im- 
portant forms  of  certificates  required  by  the  Corpora- 
tion Act,  together  with  certain  other  forms  of  votes, 
records,  etc.,  and  instructions  to  incorporators  and 
officers  concerning  the  same. 

[The  only  certified  copies  now  required  for  filing 
with  the  town  clerk  are  certificates  of  incorporation  of 
stock  companies  (including  any  amendments  made 
before  filing  the  certificate  of  organization)  and  of 
corporations  without  capital  stock,  and  of  annual 
reports,  which  must  be  filed  by  chartered  companies 
as  well  as  those  organized  under  the  general  law.] 

FORMS. 


1.  Certificate  of  incorporation. 

2.  Amendment  before  organization. 

3.  Subscription  to  capital  stock. 

4.  Notice  of  first  meeting. 

5.  Waiver  of  notice. 

6.  Record  of  first  meeting  of  directors. 

7.  Certificate  of  organization. 

8.  Statement  of  property  received  for  capital  stock. 

9.  Certificate  of  change  of  name. 

10.  Certificate  of  change  of  nature  of  business. 

11.  Certificate  of  change  of  location. 

12.  Certificate  of  increase  of  capital  stock. 

13.  Certificate  of  issue  of  preferred  stock. 

14.  Certificate  of  issue  of  additional  shares  of  stock. 

15.  Certificate  of  reduction  of  capital  stock. 

16.  Certificate  of  publication  of  certificate  of  reduc- 

tion of  capital  stock. 

17.  Certificate  of  purchase  of  own  stock. 

18.  Annual  report. 


144  Appendix 

19.  Certificate  of  consolidation  or  merger. 

20.  Certificate  of  surrender  of  rights. 

21.  Certificate  of  stockholders'  agreement  to  dissolve. 

22.  Certificate  of  vote  to  dissolve. 

23.  Final  certificate  of  dissolution. 

24.  Certificate  of  dissolution,  substitute  for  23. 

25.  Certificate    of    acceptance    of.   amendment    to 

charter. 

26.  Articles  of  association  for  corporations  without 

capital  stock. 

27.  Officers'  statement  by  foreign  corporations. 

28.  Certificate  of  appointment  of  Secretary  of  State 

as  attorney  by  foreign  corporation. 

29.  Annual  report  by  foreign  corporation. 

30.  Statement  of  mining  and  oil  corporation. 
Fees  and  taxes. 

[The  three  or  more  persons  associating  for  the  pur- 
pose of  forming  a  corporation  shall  file  in  the  office 
of  the  secretary  of  state  a  certificate,  signed  and  sworn 
to  by  all  of  them,  as  follows:] 


FOEM  I. 

Certificate  of  Incorporation  of  The 

We,  the  subscribers,  certify  that  we  do  hereby  asso- 
ciate ourselves  as  a  body  politic  and  corporate  under 
the  statute  laws  of  the  State  of  Connecticut;  and  we 
further  certify: 

First:  That  the  name  of  the  corporation  is  (a)  The 

Company,  Corporation, 

(b)     

Incorporated. 

Second:  That  said  corporation  and  its  principal 
office  or  place  of  business  is  to  be  located  in  the  town 

of ,  in  the  State  of 

Connecticut. 


Appendix  145 

Third:  That  the  nature  of  the  business  to  be  tran- 
sacted, and  the  purposes  to  be  promoted  or  carried 
out,  by  said  corporation,  are  as  follows : 


Fourth:  That  the  amount  of  the  capital  stock  of 

said  corporation  hereby  authorized  is 

dollars,  divided  into shares  of  the  par 

value  of dollars  each,  which  stock 

shall  be  divided  into  classes  as  follows : 


Fifth:  That  the  amount  of  capital  stock  with  which 

said  corporation  shall  commence  business  is 

dollars. 

Sixth:  That  the  duration  of  said  corporation  is  un- 
limited to years. 

Seventh: 

Signatures  op  Incorporators. 

Name.  Residence. 

of State  of 

of State  of 

of State  of 

of State  of 

of State  of 

Dated  at this day  of 19 . . 

State  of  y     hs  :  19 

County  of J 

Personally  appeared   


146  Appendix 


being  all  of  the  incorporators  of , 

and  made  solemn  oath  to  the  truth  of  the  foregoing 
certificate  by  them  respectively  subscribed,  before  me. 


Justice  of  the  Peace. 
Notary  Public. 

State  of  Connecticut,     |  ^^  .  ^g 

Office  of  the  Secretary.      j 

Indorsed : 


Secretary. 
State  of  Connecticut, 


Office  of  the  Secretary. 

I  hereby  certify  that  the  foregoing  is  a  true  copy 
of  a  certificate  filed  in  this  office,  and  of  the  indorse- 
ment of  approval  thereon. 

In  Testimony  Whereof,  I  have  hereunto  set  my 
hand,  and  affixed  the  Seal  of  said  State, 

at  Hartford,  this 

day  of ,  A.  D.  19.... 

J 

Secretary. 

[On  payment  of  the  franchise  tax  to  the  treasurer 
of  the  state,  as  required  hy  §  61  of  the  Corporation 
Act,  this  certificate  will  he  indorsed  '^ Approved'^  hy 
the  secretary  of  state,  who  will  furnish  a  certified  copy 
thereof  and  of  his  approval,  which  copy  must  he  filed 
in  the  office  of  the  town  clerk  of  the  town  in  which  the 
corporation  is  to  he  located  {see  §  60  ante),  and  the 
associated  persons  thereupon  hecome  '' Incorporators' ' 
{see  §  66  ante)  with  power  to  receive  subscriptions  to 
the  capital  stock  and  to  organize  the  corporation.] 


Appendix  147 

FOEM  II. 

Amendment  Before  Organization  of  Certificate  of  Incor- 
poration. 

We,  the  undersigned,  being  all  of  the  incorporators 

of  The ,  a  corporation 

whose  certificate  of  incorporation  was  filed  in  the  office 

of  the  secretary  of  state  on  the day  of 

,  19 ,  and  whose  certificate  of  organi- 
zation has  not  yet  been  filed  in  said  office,  hereby 

certify  that  paragraph of  said  certificate 

has  been  amended  by  striking  out  the  words  " 

"  and  inserting  in  lieu  thereof  the 

words  *  * "  so  that  said  paragraph 

as  amended  shall  read  as  follows : 

And  we  further  certify  that  such  amendment  has 
been  approved  in  writing  by  all  of  the  subscribers  to 
the  capital  stock  of  said  corporation,*  none  of  the 
capital  stock  of  said  corporation  has  been  subscribed 
for.* 

Dated  at this 

day  of ,19 


Incorporators. 

State  of  Connecticut,     )  ^  . 
County  of 3 

Personally  appeared ,  being  all  of  the 

incorporators  of  The ,  and  made 

solemn  oath  to  the  truth  of  the  foregoing  certificate 
by  them  respectively  subscribed,  before  me. 


Justice  of  the  Peace. 
Notary  Public. 


^Strike  out  whichever  of  these  clauses  does  not  apply. 


148  Appendix 

FOEM  III. 
Subscription  to  Capital  Stock. 

"Whereas  the  Certificate  of  Incorporation  of  The 

on  file  in  the  office  of  the 

Town  Clerk  of  the  Town  of ,  State  of 

Connecticut,  in  which  town  said  corporation  is  to  be 
located,  sets  forth  that  said  corporation  is  to  be 
organized  under  the  statute  laws  of  the  State  of  Con- 
necticut, and  has  an  authorized  capital  stock  of 

dollars,  divided  into   

shares,  each  of  the  par  value  of 

dollars,  divided  into  classes  as  follows:  {Insert  de- 
scription of  different  classes  as  stated  in  fourth  section 
of  the  Certificate  of  Incorporation.) 

Now,  therefore,  subject  to  the  provisions  of  the 
statute  laws  of  the  State  of  Connecticut,  and  under 
the  terms  and  conditions  set  forth  in  said  Certificate 
of  Incorporation,  each  subscriber  hereto  agrees  to 
take  the  number  and  class  of  shares  of  said  capital 
stock  annexed  to  his  name,  each  share  to  be  of  the  par 

value  of dollars, 

and  further  agrees  to  pay  for  the  same  in  cash  and  in 
such  instalments  as  the  directors  shall  call  in  the  same 
upon  receipt  of  due  notice  of  the  amount  thereof  and 
the  time  when  they  are  payable.  {Note.  If  otherwise 
than  in  cash  it  may  he  so  noted  in  the  subscription.) 

Dated  at ,  this day  of 

,19.... 

Name.  Residence.  Address.  No.  and  class  of  shares. 


Appendix  149 

[The  following  may  he  used  as  a  form  for  calling 
the  first  meeting  by  publication:] 

FORM  IV. 

Notice  of  First  Meeting. 

The  undersigned  being  a  majority  of  the  incorpo- 
rators of  The  , 

a  corporation  to  be  organized  under  the  statute  laws 
of  the  State  of  Connecticut,  hereby  unite  in  calling 
the  first  meeting  of  said  corporation  to  be  held  at 

,  in  the  town  of in  said 

state,  on  the day  of ,  19 , 

at o  'clock  . .  M.    And  in  compliance  with  the 

provisions  of  said  statute  laws  this  notice  is  published 
twice,  at  least  seven  days  before  the  time  set  for  said 

meeting,  in  The ,  a  newspaper  of  this 

state  having  a  circulation  in  the  town  of 

in  this  state,  in  which  town  said  corporation  is  to  be 
located. 

Dated  at ,  this day  of 

19.... 


A  majority  of  the  Incorporators. 

[//,  however,  all  of  the  subscribers  for  capital  stock 
and  a  majority  of  the  incorporators  sign  a  waiver  of 
notice  of  the  first  meeting,  a  form  for  which  follows, 
the  publication  of  the  foregoing  notice  may  be  dis- 
pensed with.] 


150  Appendix 

FOEM  V. 
Form  of  Waiver  of  Notice. 

NOTICE  OP  THE  FIRST  MEETING  OF  THE  A.  B.  CORPORA- 
TION. 

The  undersigned  being  a  majority  of  the  incorpora- 
tors, and  all  the  subscribers  to  the  capital  stock,  of 
''The  A.  B.  Corporation,"  a  corporation  to  be  organ- 
ized under  the  statute  laws  of  the  State  of  Connecti- 
cut, hereby  unite  in  calling  the  first  meeting  of  said 

corporation  to  be  held  at in  the  town 

of ,  county  of , 

in  said  state,  on  the day  of , 

A.  D.,  19. . . .,  at o'clock,   . .  M.,  and  we  do 

hereby  severally,  each  for  himself,  waive  all  right  to, 
and  agree  to  dispense  with,  the  seven  days'  notice 
for  said  meeting,  specified  in  the  statute  laws  under 
which  said  company  is  to  be  organized.  And  this 
instrument  is  to  be  recorded  at  length  upon  the 
records  of  said  corporation. 

Dated  at ,  this day  of 

,19.... 

[At  said  first  meeting  a  temporary  clerk  shall  he 
chosen  by  the  subscribers  to  the  capital  stock,  the  in- 
corporators having  no  vote  unless  they  are  also  sub- 
scribers for  the  stock,  their  duties  as  incorporators 
having  ceased  with  the   beginning  of  the   meeting. 

The  temporary  clerk  should  open  the  record  book 
as  follows:  He  should  first  copy  the  certificate  of  incor- 
poration, with  the  names  of  the  incorporators,  and 
the  indorsements  showing  payment  of  the  franchise 
tax  and  the  approval  of  the  secretary  of  state,  and 
attest  it  as  a  true  copy  thus  : 

**The  foregoing  is  a  true  copy  of  the  original 
Certificate  of  Incorporation  of  The 
and  of  the  indorsements  thereon.^* 

Attest:  , 

Temporary  Clerk. 


Appendix  151 

He  should  next  copy  the  form  of  subscription  to  the 
capital  stock  with  the  names j  residences,  and  addresses 
of  the  subscribers,  and  the  number  and  class  of  shares 
subscribed  for  by  each,  and  attest  it  as  a  true  copy  in 
the  manner  shown  above. 

He  should  next  copy  the  notice  of  the  first  meeting, 
or  the  waiver  of  notice  if  publication  was  dispensed 
with,  attaching  a  similar  certificate. 

He  should  then  begin  his  record  of  the  first  meeting 
of  the  subscribers  to  the  capital  stock  as  follows:] 

At  the  first  meeting  of  the  stockholders  of  The 

,  held  at ,  in  the 

town  of  ,  county  of  , 

State  of  Connecticut,  at   o  'clock   . . .   M.,  in 

pursuance  of  the  (foregoing  notice  and  waiver)  or 
(foregoing  notice)  was  by- 
ballot  chosen  temporary  clerk,  and  the  following 
named  persons,  subscribers  for  the  stock  of  said  cor- 
poration, were  by  ballot  duly  elected  directors  of  said 
corporation  to  hold  their  offices  until  the  next  annual 
meeting  of  the  corporation,  and  until  others  shall  be 
chosen  in  their  stead. 

[Insert  names  and  addresses  of  directors.] 

The  following  were  adopted  as  by-laws  for  the  regu- 
lation of  the  affairs  of  the  corporation : 

[Annexed  are  some  general  by-laws  adapted  to 
most,  if  not  all,  corporations  organized  under  this  act, 
which  can  be  altered,  added  to,  or  omitted  as  the  exi- 
gencies of  each  company  may  require.] 

First.  The  stock,  property  and  affairs  of  this  cor- 
poration shall  be  under  the  care  and  management  of 

not  less  than  three  nor  more  than directors, 

who  shall  be  stockholders,  and  shall  be  chosen 
annually,  at  the  annual  meeting  of  said  corporation. 

Second.    The  officers  of  this  corporation  shall  con- 


152  Appendix 

sist  of  a  president,  secretary  and  treasurer  [and  the 
same  person  may  fill  the  office  of  president  and  treas- 
urer, or  of  secretary  and  treasurer] . 

Third.  It  shall  be  the  duty  of  the  president  to  pre- 
side at  all  the  meetings  of  the  stockholders  of  said 
corporation,  and  in  his  absence  a  president  pro  tern. 
shall  be  appointed  for  such  duty.  And  he  shall  also 
perform  all  the  duties  specially  required  of  him  by  the 
act  under  which  this  corporation  is  organized. 

Fourth.  It  shall  be  the  duty  of  the  secretary  to 
make  and  keep  records  of  the  votes,  doings  and  pro- 
ceeding of  all  meetings  of  the  stockholders  and  of  the 
directors  of  said  corporation,  which  records  shall  at 
all  reasonable  times  be  open  to  the  inspection  of  the 
stockholders;  he  shall  discharge  all  other  duties 
specially  required  of  such  officer  by  the  act  aforesaid. 
He  shall  also  transmit  to  the  stockholders  and  direct- 
ors the  notices  required  by  these  by-laws  and  by  law. 

Fifth.  It  shall  be  the  duty  of  the  treasurer  to 
receive  and  keep  the  cash  funds  and  notes  belonging 
to  the  corporation,  and  to  enter  regularly  in  books 
kept  for  that  purpose  all  moneys  received  and  dis- 
bursed on  account  of  said  corporation,  which  books 
shall  at  all  reasonable  times  be  open  to  the  inspection 
of  the  stockholders  of  said  company;  [and  in  the 
prosecution  of  the  business  of  said  corporation  (but 
for  no  other  purpose)  said  officer  may  in  behalf  of  the 
corporation  make,  draw,  endorse  and  accept  cheques, 
notes  and  bills  of  exchange].  He  shall  perform  all 
other  acts  and  duties  specially  required  of  such  officer 
by  the  act  aforesaid  [and  shall  give  bond  in  the  sum 

of dollars  to  the  acceptance  of  the 

directors,  for  the  faithful  discharge  of  his  duties] . 

Sixth.  Annual  meetings  of  the  stockholders  of  said 
corporation  and  for  the  choice  of  directors  thereof, 
and  for  the  transaction  of  any  other  appropriate 
business,  shall  be  held  on  the  first  [Monday]  of 
in  each  year,  at  the  office  of  the  corpora- 
tion in  the  town  of 


Appendix  153 

Seventh.  Special  meetings  of  the  stockholders  of 
said  corporation  may  be  held  at  any  time  upon  like 
notice,  as  that  prescribed  in  said  act  for  annual  meet- 
ings, and  the  president  shall  give  such  notice  upon  the 
request  in  writing  of  one  or  more  stockholders,  hold- 
ing at  least  one-tenth  of  the  capital  stock  calling  for 
such  special  meeting,  and  shall  specify  therein  the 
object  and  purpose  of  such  meeting. 

Eighth.  Regular  meetings  of  the  directors  of  said 
corporation  shall  be  held  on  [the  first  Monday  of  each 
month] ,  and  special  meetings  of  the  directors  may  be 
held  at  such  times  and  places  as  in  the  opinion  of  the 
president  the  interests  of  said  corporation  shall  re- 
quire, reasonable  notice  having  been  given  thereof. 

Ninth.  All  votes  of  said  corporation  shall,  if  re- 
quested by  any  stockholder,  be  by  ballot,  and  the 
name  of  each  stockholder  voting  shall  be  written 
thereon  with  the  number  of  shares  held  by  him.  Any 
stockholder  may  constitute  an  agent  to  vote  in  the 
meetings  of  this  corporation  by  writing  signed  by  him 
for  that  purpose  [and  such  proxy  shall  entitle  the  per- 
son thus  authorized  to  vote  at  all  meetings  of  the 
stockholders  held  during  the  eleven  months  next  suc- 
ceeding the  date  of  said  instrument,  and  no  longer, 
unless  a  longer  term  be  expressly  provided  for  there- 
in]. 

Tenth.  Whenever  the  directors  shall  call  in  the 
capital  stock  of  said  corporation  by  instalments  or 
otherwise,  the  treasurer  shall  give  notice  thereof,  by 
letter  addressed  to  the  several  stockholders  at  their 
respective  places  of  residence,  which  notices  shall  be 
given  at  least  days  before  said  pay- 
ment shall  be  required  to  be  made. 

Eleventh.  Regular  transfer  books  shall  be  kept  by 
the  secretary,  and  no  transfer  shall  be  permitted 
except  upon  said  books  either  by  the  stockholder  in 
person,  or  by  power  of  attorney  executed  by  him  for 
that  purpose. 

Twelfth.     The   by-laws   of   this   corporation   may 


154  Appendix 

be  altered  or  repealed  at  any  legal  meeting  of  the 
stockholders  by  a  majority  vote  of  the  stock  repre- 
sented at  such  meeting  [but  no  alteration  of  said  by- 
laws shall  be  made  at  any  meeting  unless  a  majority 
of  the  whole  stock  of  said  corporation  shall  be  repre- 
sented at  such  meeting] . 

The  meeting  then  adjourned. 

Attest :  , 

Temporary  Clerk. 

[At  the  adjournment  of  the  first  meeting  of  the 
stockholders  the  duties  of  the  temporary  clerk  cease, 
and  the  record  hook  is  thereafter  to  he  attested  hy  the 
secretary  of  the  corporation,  who  is  to  he  elected  at  the 
first  meeting  of  the  directors.  This  meeting  may  he 
held  after  the  adjournment  of  the  first  meeting  of  the 
stockholders,  and  a  form  of  record  thereof  may  he  as 
follows:] 

FOEM  VI. 

Form  of  Record  of  the  First  Meeting  of  Directors. 

At  a  meeting  of  the  directors  of  The  A.  B.  Com- 
pany, held  pursuant  to  legal  notice  at , 

in  the  town  of 

Present 

[It  is  advisahle  that  the  record  should  in  all  cases 
disclose  the  names  of  the  directors  present  at  meetings 
of  the  hoard.] 

The  following  named  persons  were  elected  officers 
of  said  corporation,  to  hold  their  offices  respectively 
until  the  next  annual  meeting  of  the  corporation,  and 
until  others  shall  be  chosen  in  their  stead — to  wit: 
to  be  president  of  said  cor- 
poration ;    to  be  secretary  of 

said  corporation ; to  be  treasurer 

of  said  corporation. 


Appendix  155 

Voted,  That  a  majority  of  the  directors  make  and 
caused  to  be  filed  the  certificate  of  organization  of 
this  corporation,  in  compliance  with  the  requirements 
of  law,  and 

Voted,  That  the  secretary  of  this  corporation  be  and 
is  hereby  directed  to  file  said  certificate  of  organiza- 
tion in  the  office  of  the  secretary  of  state. 

The  meeting  then  adjourned. 

Attest :  , 

Secretary. 

[A  majority  of  the  directors  should  then  make  and 
swear  to  the  certificate  of  organization. 

The  secretary  of  the  corporation  should  then  con- 
tinue his  record  as  follows:] 

In  pursuance  of  the  foregoing  vote  of  the  directors 
I  caused  the  certificate  of  organization  of  this  corpora- 
tion to  be  filed  in  the  office  of  the  secretary  of  state 

on  the day  of  ,  19 .... ,  and  on 

the day  of  ,  19 .... ,  I  received 

from  him  a  copy  thereof  duly  approved  by  him  and 
certified  under  his  hand  and  the  seal  of  the  state,  of 
which  the  following  is  a  true  copy : 


FORM  VII. 

Certificate  of  Organization. 

The  undersigned,  a  majority  of  the  directors  of  The 

,  located  in  the  town  of , 

hereby  certify  as  follows : 

First.     That  the  amount  of  the  authorized  capital 

stock  subscribed  for  is shares,  of 

dollars  each,  being shares  of  preferred  stock 

and shares  of  common  stock,  amounting 


156  Appendix 

to dollars,  and  being  not  less  than  the  full 

amount  of  dollars,  with  which  the  in- 
corporators in  the  certificate  of  incorporation  stated 
the  company  would  begin  business. 

Second.  That  the  amount  paid  thereon  in  cash  is 
dollars. 

Third.  That  the  amount  paid  thereon  in  property- 
other  than  cash  is dollars. 

Fourth.    That dollars  has  been  paid 

upon  each  share  subscribed  for  except 

shares,  upon  which 

dollars  only  has  been  paid. 

Fifth.  That  the  name,  residence  and  address  of 
each  of  the  original  subscribers  to  said  stock,  with  the 
the  number  and  class  of  shares  subscribed  for  by  each, 
are  as  follows : 

No.  of  shares      No.  of  shares 
Name.         Residence,         P.  O.  Address.  preferred.  common. 

Sixth.  That  the  directors  and  officers  of  said  cor- 
poration have  been  duly  elected,  and  that  its  by-laws 
have  been  adopted. 

Seventh.  The  name,  residence  and  post  office 
address  of  each  of  the  officers  and  directors  of  said 
corporation  are  as  follows : 

Name.  Residence.  P.  O.  Address. 

President,  

Vice-President,  

Treasurer,  

Assistant  Treasurer,  

Secretary,  

Assistant  Secretary,  

Residence.  P.   O.  Address. 

Directors,  


Eighth.    The  location  of  its  principal  office  in  this 

state  is  No Street, 

,  and  the  name  of  the  agent  or  person  in  charge 


Appendix  157 

thereof  on  whom  process  against  it  may  be  served  is 


Dated  at ,  this day  of 

,19.... 


A  majority  of  the  Directors. 

State  op  Connecticut,    K^  .  -j^g 

County  of ) 

Personally  appeared  signers  of  the 

foregoing  certificate  of  organization,  a  majority  of 

the  directors  of  The ,  and  made 

oath  to  the  truth  of  the  same  before  me. 


Justice  of  the  Peace. 
Notary  Public. 

State  of  Connecticut,     1^,  -|^g 

Office  of  the  Secretary.      ) 

Indorsed :   


Secretary. 
^^     Iss.: 19.... 


State  op  Connecticut 
Office  of  the  Secretary 

I  hereby  certify  that  the  foregoing  is  a  true  copy 
of  a  certificate  filed  in  this  office  and  of  the  indorse- 
ment of  approval  thereon. 

In  Testimony  Whereof,  I  have  hereunto  set 
my  hand  and  affixed  the  Seal  of  said  State, 

at  Hartford,  this  day 

of ,19.... 


Secretary. 

Attest :  , 

Secretary. 


158  Appendix 

[After  the  certificate  of  organization  has  been  ap- 
proved hy  the  secretary  of  state,  the  directors  have 
power  to  call  in  instalments  of  the  capital  stock  and 
to  assume  the  control  of  the  property  and  affairs  of 
the  corporation.  A  form  of  vote  to  call  in  instalments 
is  as  follows:] 

Voted,  That  an  instalment  of dol- 
lars on  each  share  of  the  capital  stock  of  this  cor- 
poration be  called,  and  the  same  be  paid  to  the  treas- 
urer of  the  corporation  on  or  before  the 

day  of ,  19 ... . 

[//  any  property  other  than  cash  is  received  in  pay- 
ment for  capital  stock  the  directors  are  required  hy 
§  12  to  sign  a  statement  on  the  record  hook  of  the 
corporation  showing  of  what  the  property  consists  and 
its  actual  value.  In  such  case  the  following  form  may 
he  used:] 


FOEM  yilL 


Statement  of  Property  Received  for  Capital  Stock. 

We,  the  undersigned,  a  majority  of  the  directors  of 
The    

i 

hereby  make  and  sign  upon  this,  the  record  book  of 
said  corporation,  the  following  statement  showing 
particularly  of  what  the  property  other  than  cash 
received  in  payment  for  subscriptions  to  capital  stock 
consists,  and  that  it  has  an  actual  value  equal  to  the 
amount  for  which  it  is  so  received. 

Value  for 
Description  of  property.  which  received.  Actual  value. 


Appendix  159 


A  majority  of  the  Directors. 

[While  the  property  and  affairs  of  the  corporation 
are  under  the  control  and  management  of  the  directors 
by  statutory  provision  {see  §  10)  it  is  nevertheless 
desirable  at  times  that  the  stockholders  should  pass  a 
vote  in  the  nature  of  a  request  to  the  directors,  asking 
them  to  take  action, — as,  for  instance,  in  the  matter 
of  the  investment  of  a  large  part  of  the  capital  of  the 
corporation  in  the  purchase  of  land,  machinery,  stock, 
etc.     Such  a  vote  follows:] 

Voted,  That  the  directors  of  this  corporation  be 
and  they  are  hereby  requested — if  in  their  opinion  it 

be  advisable — to  purchase  of   

(at  a  sum  not  exceeding dollars)  or 

(upon  such  terms  as  they  may  deem  best,  etc.)   the 
following  described  property : 


[The  following  forms  of  certificates  may  be  used 
after  the  passage  of  the  appropriate  resolutions  by  the 
stockholders,  the  character  of  the  resolution  required 
being  sufficiently  indicated  in  the  form  of  certificate 
to  be  filed.  The  record  book  of  the  corporation  should 
show  the  vote  of  the  directors  instructing  the  secretary 
to  file  the  certificate  with  the  secretary  of  state,  the 


160  Appendix 

statement  that  the  certificate  has  been  filed,  a  copy  of 
the  certificate  itself,  all  of  which  may  he  shown  in  the 
same  manner  as  is  prescribed  concerning  the  Certifi- 
cate of  Organization.] 

FORM  IX. 
Certificate  of  Change  of  Name. 

We,  the  undersigned,  a  majority  of  the  directors 

of  The 

Corporation,  Incorporated,  a  corporation  organized 
under  the  statute  laws  of  the  State  of  Connecticut 

and  located  in  the  town  of ,  in 

said  state, 

Hereby  Certify:  That  at  a  meeting  of  the  stock- 
holders of  said  corporation  duly  called  for  that  pur- 
pose and  held  at ,  in  said  state, 

on  the day  of ,  19 .... ,  the 

name   of   said   corporation   was   changed   from   The 

Corporation,  Incorporated,  to  The 


Corporation,  Incorporated,  by  a  resolution  adopted 
at  said  meeting  by  a  vote  of  (more  than)  two-thirds 
of  all  the  outstanding  stock  of  each  class,  of  which 
resolution  the  following  is  a  copy : 


Dated  at ,  this day  of 

19.... 


A  majority  of  the  Directors. 


Appendix  161 

State  op  Connecticut,     K^  .  ^g 

County  of 3 

Personally  appeared   


a  majority  of  the  directors  of  The 


and  made  oath  to  the  truth  of  the  foregoing  certifi- 
cate, by  them  signed,  before  me. 


Justice  of  the  Peace. 
Notary  Public. 

FORM  X. 

Certificate  of  Change  of  Nature  of  Business. 

We,  the  undersigned,  a  majority  of  the  directors 
of  The 

Corporation,  Incorporated,  a  corporation  organized 
under  the  statute  laws  of  the  State  of  Connecticut, 

and  located  in  the  town  of in 

said  state, 

Hereby  Certify:  That  at  a  meeting  of  the  stock- 
holders of  said  corporation  duly  called  for  that  pur- 
pose, and  held  at  ,  in  said  state,  on 

the   day  of  ,  19 ,  the 

nature  of  the  business  to  be  transacted,  and  the  pur- 
poses to  be  promoted  or  carried  out,  by  said  corpora- 
tion, were  changed,  by  a  resolution  adopted  at  said 
meeting  by  a  vote  of  (more  than)  two-thirds  of  all  the 
outstanding  stock  of  each  class,  of  which  resolution 
the  following  is  a  copy : 


162  Appendix 

Dated  at ,  this day  of 

19.... 


A  majority  of  the  Directors. 

State  op  Connecticut,     )  j.q 

County  of 3 

Personally  appeared 


a  majority  of  the  directors  of  The 


and  made  oath  to  the  truth  of  the  foregoing  certifi- 
cate, by  them  signed,  before  me. 


Justice  of  the  Peace. 
Notary  Public. 


FORM  XI. 


Certificate  of  Change  of  Location. 

"We,  the  undersigned,  a  majority  of  the  directors  of 
The    

5 

a  corporation  organized  under  the  statute  laws  of 
the  State  of  Connecticut  and  located  in  the  town  of 

,  in  said  state,  hereby  certify : 

That  at  a  meeting  of  the  stockholders  of  said  cor- 
poration duly  called  for  that  purpose,  and  held  at 
,  in  said  state,  on  the day 


Appendix  163 

of ,  19 ,  the  location  of  said  cor- 
poration was  changed  from  the  town  of 

aforesaid,  to  the  town  of ,  in  said 

state,  by  a  resolution  adopted  by  the  stockholders  at 
said  meeting  by  a  vote  of  (more  than)  two-thirds  of 
all  the  outstanding  stock  of  each  class,  of  which  reso- 
lution the  following  is  a  copy : 


Dated  at ,  this day  of 

19.... 


A  majority  of  the  Directors. 

State  of  Connecticut,     L^  .  ^g 

County  of 3 

Personally  appeared   


a  majority  of  the  directors  of  The 


and  made  oath  to  the  truth  of  the  foregoing  certifi- 
cate, by  them  signed,  before  me. 


Justice  of  the  Peace. 
Notary  Public. 


164  Appendix 

FOEM  XII. 

Certificate  of  Increase  of  Capital  Stock. 

We,  the  undersigned,  a  majority  of  the  directors  of 
The    

» 

a  corporation  organized  under  the  statute  laws  of  the 
State   of   Connecticut  and  located  in  the  town   of 

,  in  said  state. 

Hereby  Certify:  That  at  a  meeting  of  the  stock- 
holders of  said  corporation  duly  called  and  held  for 

that  purpose  at      ,  in  said  state, 

on  the day  of ,  19 .... ,  the 

authorized    capital    stock    of    said    corporation    was 

increased  from  the  sum  of 

dollars  to  the  sum  of 

dollars,  and  the  number  of  shares  of  the  capital  stock 
was  proportionately  increased  from  the  number  of 

shares  of  preferred  and 

shares  common,  to  the  number  of 

shares  preferred  and shares  common, 

each  share  of  the  par  value  of dollars, 

by  a  resolution  duly  adopted  by  a  vote  of  (more  than) 
two-thirds  of  all  the  outstanding  stock  of  each  class, 
of  which  resolution  the  following  is  a  copy : 


Dated  at ,  this day  of 

19.... 


A  majority  of  the  Directors. 


Appendix  165 


State  of  Connecticut,    )  ^q 

County  of | 

Personally  appeared   , 


a  majority  of  the  directors  of  The 


and  made  oath  to  the  truth  of  the  foregoing  certifi- 
cate, by  them  signed,  before  me, 


Justice  of  the  Peace. 
Notary  Public. 


FORM  XIII. 

Certificate  of  Issue  of  Preferred  Stock. 

We,  the  undersigned,  a  majority  of  the  directors  of 

The , 

a  corporation  organized  under  a  special  charter 
granted  by  the  general  assembly  of  the  State  of  Con- 
necticut, and  located  in  the  town  of , 

in  said  state. 

Hereby  Certify:  That  at  a  meeting  of  the  stock- 
holders of  said  corporation  duly  called  and  held  for 

that  purpose  at ,  in  said  state, 

on  the day  of ,  19 .... , 

it  was  resolved  by  a  vote  of  (more  than)  two-thirds  of 
all  the  stock  of  such  corporation,  to  increase  the  capi- 
tal stock  of  said  corporation  by  issuing  shares  of  pre- 
ferred stock,  of  the  par  value  of dollars 

each,  which  shares  shall  be  entitled  to  dividends  at 

the  rate  of per  centum  per  annum  before 

anything  shall  be  paid  on  the  common  stock,  said 
dividends  to  be  cumulative,  making  the  whole  number 
of  shares  issued ,  and  the  whole  amount 


166  Appendix 

of  capital  stock dollars,  of  which  resolution 

the  following  is  a  copy : 


Dated  at ,  this day  of 

,19.... 


A  majority  of  the  Directors. 


State  op  Connecticut,     ,      .  -.  g 


County  of ) 

Personally  appeared   . . 


a  majority  of  the  directors  of  The 


and  made  oath  to  the  truth  of  the  foregoing  certifi- 
cate, by  them  signed,  before  me, 


Justice  of  the  Peace. 
Notary  Public. 

FORM  XIV. 

Certificate  of  Issue  of  Additional  Shares  of  Stock. 

The  undersigned,   a  majority  of  the   directors  of 
The    

J 

a  corporation  organized  under  the  statute  laws  of 
the  State  of  Connecticut,  and  located  in  the  town  of 
,  in  said  state, 


Appendix  167 

Hereby  Certify:  That  at  a  meeting  of  the  stock- 
holders of  said  corporation  duly  warned  for   that 

purpose  and  held  at ,  in  said 

state,  on  the day  of 

19 .... ,  the  directors  were  empowered  by  a  vote  of 
(more  than)   two-thirds  of  all  the  stock  represented 

at  said  meeting  to  issue additional 

shares  of  the  authorized  capital  stock  of  said  corpora- 
tion, and  at  a  meeting  of  said  directors  held  on  the 

day  of  ,  19   . . . . ,  it  was 

voted  to  issue  said  shares,  thereby  making  the  out- 
standing stock dollars,  and  we  do 

further  certify: 

First.     That  the  amount  of  said  additional  shares 

issued  is dollars,  divided  into 

shares  of  preferred  stock,  and 

shares  of  common  stock,  each  share 

of  the  par  value  of dollars. 

Second.  That  all  of  said  shares  have  been  sub- 
scribed for. 

Third.  That  the  amount  paid  thereon  in  cash  is 
dollars. 

Fourth.    That  the  amount  paid  thereon  in  property 

other  than  cash  is dollars,  and  the 

character  of  such  property  is  as  follows : 


Fifth.     That  dollars  has  been  paid 

on  each  of  said  shares  except shares, 

upon  which   dollars  only  has  been 

paid. 

Sixth.  That  the  name,  residence,  and  address  of 
each  of  the  subscribers  to  said  stock  with  the  num- 
ber and  class  of  shares  subscribed  for  by  each,  are 
as  follows; 


168  Appendix 

Name.  Residence.  No.  and  class  of  shares. 


Dated  at ,  this day  of 

,19.... 


A  majority  of  the  Directors. 

State  of  Connecticut,     Iss  -  19 

County  of j 

Personally  appeared   


a  majority  of  the  directors  of  The 


and  made  oath  to  the  truth  of  the  foregoing  certifi- 
cate, by  them  signed,  before  me, 


Justice  of  the  Peace. 
Notary  Public. 

FOEM  XV. 

Certificate  of  Reduction  of  Capital  Stock. 

We,  the  undersigned,  a  majority  of  the  directors  of 

The  , 

a  corporation  organized  under  the  statute  laws  of 


Appendix  169 

the  State  of  Connecticut  and  located  in  the  town  of 

,  in  said  state, 

Hereby  Certify:  That  at  a  meeting  of  the  stock- 
holders of  said  corporation  specially  warned  for  that 

purpose,  and  held  at   ,  in  said 

state  on  the day  of ,  19 .... , 

the  authorized  capital  stock  of  said  corporation  was 

reduced  from  the  sum  of dollars  to  the 

sum  of dollars,  and  the  number  of  shares 

of  the  capital  stock  was  proportionately  decreased 

from shares  preferred  and 

shares  common,  to shares  pre- 
ferred and shares  common  (the  par 

value   of  the  shares  was  proportionately  decreased 

from dollars  per  share  to 

dollars  per  share),  by  a  resolution  adopted  at  said 
meeting  by  a  two-thirds  vote  of  all  the  outstanding 
stock  of  each  class,  a  copy  of  which  resolution  is  as 
follows : 


And  we  do  further  certify  that  the  records  of  the 
corporation  contain  a  complete  list  of  all  the  stock- 
holders who  voted  in  favor  of  said  resolution  to  reduce 
the  capital  stock. 

Dated  at ,  this day  of 

19.... 


A  majority  of  the  Directors. 


170  Appendix 

State  of  Connecticut,    L^  .  ^g 

Comity  of 

Personally  appeared  . 


a  majority  of  the  directors  of  The 


and  made  oath  to  the  truth  of  the  foregoing  certifi- 
cate, by  them  signed,  before  me. 


Justice  of  the  Peace. 
Notary  Public. 


FORM  XVI. 

Certificate  of  Publication  of  Certificate  of  Reduction  of 
Capital  Stock. 

We,  the  undersigned,  a  majority  of  the  directors  of 

The , 

a  corporation  organized  under  the  statute  laws  of 
the  State  of  Connecticut  and  located  in  the  town  of 
,  in  said  state, 

Hereby  Certify:  That  a  copy  of  the  certificate  of 
reduction  of  capital  stock  of  said  corporation  filed  in 
the  office  of  the  secretary  of  state,  was  published  on 

the   days  of   ,  19 .... , 

being  twice  a  week  for  two  successive  weeks,  in  The 

1 

a  newspaper  published  in  this  state  and  having  a  cir- 
culation in  the  town  in  which  said  corporation  is 
located;  and  we  do  further  certify  that  said  publica- 
tion was  made  within  thirty  days  from  the  date  of 
the  vote  of  the  stockholders  of  said  corporation 
authorizing  said  reduction  of  its  capital  stock. 


Appendix  171 

Dated  at ,  this day  of 

,19.... 


A  majority  of  the  Directors. 

State  of  Connecticut,     K^  .  ^o 

County  of 

Personally  appeared 


a  majority  of  the  directors  of  The 


and  made  oath  to  the  truth  of  the  foregoing  certifi- 
cate, by  them  signed,  before  me, 


Justice  of  the  Peace. 
Notary  Public. 

FORM  XVII. 

Certificate  of  Purchase  of  Own  Stock. 

We,    President, 

and Treasurer, 

of  The , 

a  corporation  organized  under  the  statute  laws  of  the 
State  of   Connecticut,   and  located  in  the  town   of 

,  in  said  state,  hereby  certify 

that  at  a  meeting  of  the  stockholders  of  said  corpora- 
tion specially  warned  for  that  purpose,  held  at 

in  said  state,  on  the day  of 

19....,  a  resolution  approving  of  the  purchase  by 

said  corporation  of shares  of  its  own 

stock  was  adopted  by  a  vote  of  (more  than)  three- 


172  Appendix 

fourths  of  the  entire  outstanding  capital  stock,  at 
which  meeting  said  corporation  did  not  vote  upon  any 
shares  of  its  own  stock  held  by  it ;  and, 

Since  the  adoption  of  said  resolution  said  corpora- 
tion has  purchased  and  acquired,  and  now  holds  .... 

shares  of  its  own — Preferred — Common — 

stock.  The  following  is  a  copy  of  the  foregoing  reso- 
lution : 


President. 

> 

Treasurer. 

State  of  Connecticut,     )  ^  .  -j^g 

County  of 3 

Personally  appeared   

President,   and 

Treasurer,  of  The  , 

and  made  oath  to  the  truth  of  the  foregoing  certificate, 
by  them  signed,  before  me. 


Justice  of  the  Peace. 
Notary  Public. 

FOEM  XVIII. 

Annual  Report. 

We,    President, 

and Treasurer, 

of  The   , 

a  corporation  organized  under  the  statute  laws  of  the 
State  of   Connecticut,   and  located  in  the  town   of 

,  in  said  state,  hereby  certify 

as  of  the  first  day  of  January  (July) ,  19 .... , 


Appendix  173 

First.  That  the  name,  residence  and  post  olBfice 
address  of  each  of  its  officers  and  directors  were  as 
follows : 

Name.  Residence.  P.  O.  Address. 

President,  

Vice-President,  

Treasurer,  

Assistant  Treasurer,  

Secretary,  

Assistant  Secretary,  


Directors, 


Second.    That  the  amount  of  its  outstanding  capital 

stock  which  had  not  been  paid  for  in  full  was 

dollars,  and  the  amount  due  thereon  was 

dollars. 

Third.  The  location  of  its  principal  office  in  Con- 
necticut was  No Street, , 

and  the  name  of  the  agent  or  person  in  charge  thereof 
on  whom  process  against  it  may  be  served  is 


Dated  at ,  this day  of 

,19.... 


President. 

J 

Treasurer. 

FOEM  XIX. 


Certificate  of  Consolidation  or  Merger. 

We,  the  undersigned,  a  majority  of  the  directors  of 
each  of  the  following  named  corporations  organized 


174  Appendix 

under  the  statute  laws  of  the  State  of  Connecticut, 
to  wit : 

The 

located  in  the  town  of 

The 

located  in  the  town  of 

The 

located  in  the  town  of 

all  in  the  State  of  Connecticut,  for  the  purpose  of 
effecting  a  consolidation  and  merger  of  the  above- 
named  corporations  under  and  by  virtue  of  the  pro- 
visions of  the  statute  laws  of  said  state,  said  corpora- 
tions being  engaged  in  business  of  the  same  or  a 
similar  nature,  hereby  enter  into  an  agreement  as 
follows : 

And  we  further  agree : 

First.  That  the  name  of  the  consolidated  corpora- 
tion shall  be   

Second.  That  the  following  are  the  names  and 
places  of  residence  of  all  of  its  first  directors : 

Name.  Residence. 


Third.  That  said  corporation  and  its  principal 
office  or  place  of  business  is  to  be  located  in  the  town 
of ,  in  the  State  of  Connecticut. 

Fourth.  That  the  nature  of  the  business  to  be  trans- 
acted, and  the  purposes  to  be  promoted  or  carried 
out,  by  said  corporation,  are  as  follows : 


Appendix  175 

Fifth.    That  the  combined  capital  stock  of  the  cor- 
porations hereby  consolidating  is dollars, 

and  the  amount  of  the  capital  stock  of  said  consoli- 
dated corporation  hereby  authorized  is 

dollars,  divided  into shares  of  common 

stock  of  the  par  value  of dollars  each, 

and shares  of  preferred  stock  of  the 

par  value  of dollars  each,  the  nature 

of  the  preference  of  the  preferred  stock  being  as 
follows : 


Sixth.  That  the  duration  of  said  corporation  is 
wwlimited. 

Seventh.  That  the  manner  of  converting  the  shares 
of  capital  stock  of  each  of  the  old  corporations  into 
shares  of  the  capital  stock  of  the  consolidated  corpora- 
tion is  as  follows : 

In  witness  whereof,  we  have  hereunto  set  our  hands 
and  attached  the  seals  of  the  several  corporations  at 

,  this day  of , 

19.... 

[Seal.]  , 

[Seal.] 

[Seal.] 


Directors  of 
Directors  of 
Directors  of 


State  of  Connecticut,     l^^  ,  -^^ 

County  of 5 

I,  ,  Secretary  of 

The , 

a  corporation  organized  under  the  statute  laws  of  the 
State  of  Connecticut,  hereby  certify  that  the  fore- 
going agreement  was  on  the ,  day  of 


176  Appendix 

,  19 .... ,  submitted  to  the  stockholders 

of  said  corporation  at  a  meeting  called  for  the  purpose 
of  considering  the  same,  notice  thereof  having  been 
given,  and  publication  thereof  having  been  duly- 
made,  as  required  by  law,  and  that  two-thirds 
or  more  of  all  the  outstanding  stock  of  each  class  voted 
to  approve  such  merger  and  consolidation. 

[Seal.]  , 

Secretary  of  The 

State  op  Connecticut,     1^,  -tQ 

County  of j 

I,  ,  Secretary  of 

The , 

a  corporation  organized  under  the  statute  laws  of  the 
State  of  Connecticut,  hereby  certify  that  the  fore- 
going agreement  was  on  the day  of 

,  19 .... ,  submitted  to  the  stockholders 

of  said  corporation  at  a  meeting  called  for  the  purpose 
of  considering  the  same,  notice  thereof  having  been 
given,  and  publication  thereof  having  been  duly 
made,  as  required  by  law,  and  that  two-thirds 
or  more  of  all  the  outstanding  stock  of  each  class  voted 
to  approve  such  merger  and  consolidation. 

[Seal.]  , 

Secretary  of  The 

State  of  Connecticut,     K^  .  19 

County  of ) 

I,  ,  Secretary  of 

The , 

a  corporation  organized  under  the  statute  laws  of  the 
State  of  Connecticut,  hereby  certify  that  the  fore- 
going agreement  was  on  the day  of 

,  19 .... ,  submitted  to  the  stockholders 

of  said  corporation  at  a  meeting  called  for  the  purpose 
of  considering  the  same,  notice  thereof  having  been 
given,    and    publication   thereof    having    been    duly 


Appendix  177 

made,  as  required  by  law,  and  that  two-thirds 
or  more  of  all  the  outstanding  stock  of  each  class  voted 
to  approve  such  merger  and  consolidation. 

[Seal.]         , 

Secretary  of  The 

State  op  Connecticut,     K^  .  -,q 

County  of ) 

Personally  appeared , 

Secretary  of  The , 

and  made  oath  to  the  truth  of  the  foregoing  certificate, 
by  him  signed,  before  me. 


Notary  Public. 

Justice  of  the  Peace. 

Commissioner  of  the  Superior  Court. 

State  of  Connecticut,     )  ^  .  ^q 

County  of | 

Personally  appeared , 

Secretary  of  The , 

and  made  oath  to  the  truth  of  the  foregoing  certificate, 
by  him  signed,  before  me. 


Notary  Public. 

Justice  of  the  Peace. 

Commissioner  of  the  Superior  Court. 

State  of  Connecticut,     L^  .  -j^g 

County  of 3 

Personally  appeared , 

Secretary  of  The , 

and  made  oath  to  the  truth  of  the  foregoing  certificate, 
by  him  signed,  before  me. 


Notary  Public. 

Justice  of  the  Peace. 

Commissioner  of  the  Superior  Court. 


178  Appendix 

FORM  XX. 

Certificate  of  Surrender  of  Rights. 

We,  the  undersigned,  the  incorporators  and  sub- 
scribers for  stock  of  The , 

a  corporation  existing  under  the  statute  laws  of  the 
State  of  Connecticut,  and  located  in  the  town  of 
,  in  said  state,  hereby  certify : 

First.  That  said  corporation  has  not  been  organ- 
ized, and  no  part  of  the  subscriptions  to  its  stock  has 
been  paid. 

Second.  That  no  business  has  been  commenced  by 
said  corporation. 

Third.  That  no  debts  have  been  incurred  by  it 
which  have  not  been  paid. 

That  we  hereby  surrender  all  rights  of  said  cor- 
poration together  with  its  franchise. 

Dated  at ,  this day  of 

19.... 


Incorporators. 


Subscribers. 

State  of  Connecticut,     L^  .  -j^g 

County  of )     '  *• 

Personally  appeared , 

J 

the  incorporators 


and  subscribers  to  stock  of  The 


Appendix  179 

and  made  oath  to  the  truth  of  the  foregoing  certifi- 
cate, by  them  signed,  before  me. 


Justice  of  the  Peace. 
Notary  Public. 

FOEM  XXI. 

Certificate  of  Stockholders'  Agreement  to  Dissolve. 

We,  the  undersigned,  a  majority  of  the  directors  of 

The , 

a  corporation  organized  under  the  statute  laws  of 
the  State  of  Connecticut  and  located  in  the  town  of 

,  county  of  ,  in 

said  state,  hereby  certify : 

First.  That  every  stockholder  of  said  corporation 
has  signed  and  acknowledged  an  agreement  that  the 
corporate  existence  of  said  corporation  shall  be  ter- 
minated, which  instrument  is  dated  the 

day  of ,19.... 

Second.     All  claims  against  said  corporation  may 

be  sent  to 

P.  0.  address,  

Dated  at ,  this day  of 

19.... 


A  majority  of  the  Directors. 

State  op  Connecticut,    K^  .  -j^g 

County  of ) 

Personally  appeared   


180  Appendix 

a  majority  of  the  directors  of  The 

1 

and  made  oath  to  the  truth  of  the  foregoing  certifi- 
cate, by  them  signed,  before  me, 

Justice  of  the  Peace. 
Notary  Public. 

FOEM  XXII. 

Certificate  of  Vote  to  Dissolve. 

We,  the  undersigned,  a  majority  of  the  directors  of 
The , 

a  corporation  organized  under  the  statute  laws  of 
the  State  of  Connecticut,  located  in  the  town  of 
,  in  said  state, 

Hereby  Certify :  That  at  a  meeting  of  the  directors 

of  said  corporation,  held  at on  the 

day  of ,19 ,  it  was  voted 

to  terminate  its  corporate  existence. 

That  a  special  meeting  of  the  stockholders  was 
forthwith  called  to  be  held  thirty  days  thereafter, 
to  wit :  on  the day  of ,  19 

That  the  call  for  said  meeting  contained  a  copy 
of  said  vote,  and  was  published  four  times,  once 
during  each  week  preceding  such  meeting,   in   the 

,  a  newspaper  published  in 

and  having  a  circulation  in 

the  town  where  said  corporation  is  located,  and  a 
copy  thereof  was  sent  by  mail  to  the  last  known  ad- 
dress of  each  stockholder. 

At  said  stockholders'  meeting,  there  being  rep- 
resented in  person  or  by  proxy shares 

of  common  stock  and shares  of  pre- 
ferred stock,  it  was  voted  to  confirm  said  vote  of  the 
directors,  the  number  of  shares  of  common  stock 
voting  therefor  being ,  and  the 


Appendix  181 

number  of  shares  of  preferred  stock  voting  therefor 
being ,  and  each  being  three- 
fourths  or  more  of  the  whole  of  each  class  of  stock. 
All  claims  against  said  corporation  may  be  sent  to 


Dated  at ,  this day  of 

,19--.- 


A  majority  of  the  Directors. 

State  op  Connecticut,     1^,  -^^ 

County  of 

Personally  appeared 


being  a  majority  of  the  directors  of  The 


and  made  oath  to  the  truth  of  the  foregoing  certifi- 
cate, by  them  signed,  before  me, 


Justice  of  the  Peace. 
Notary  Public. 

FOEM  XXIII. 

Final  Certificate  of  Dissolution. 

We,  the  undersigned,  a  majority  of  the  directors  of 

The     , 

a  corporation  organized  under  the  statute  laws  of  the 
State  of  Connecticut,  and  located  in  the  town  of  .... 

,  in  said  state,  acting  herein  as  trustees 

to  close  up  the  business  of  said  corporation  under  the 
provisions  of  said  statute  laws, 


182  Appendix 

Hereby  Certify :  That  we  have  completed  our  duties 
as  prescribed  by  §§  30-34  of  Chapter  194  of  the  Public 
Acts  of  1903,  in  winding  up  the  affairs  of  said  corpora- 
tion, and  have  sold  or  collected  all  of  its  assets,  and 
have  distributed  the  same  in  the  manner  following: 


Dated  at ,  this day  of 

19.... 


A  majority  of  the  Directors  acting  as  Trustees. 
State  of  Connecticut,    )  ^  .  -^g 


County  of 
Personally  appeared 


being  a  majority  of  the  directors  acting  as  trustees  of 
The    

> 

and  made  oath  to  the  truth  of  the  foregoing  certifi- 
cate, by  them  signed,  before  me. 


Justice  of  the  Peace. 
Notary  Public. 

[The  following  form,  not  furnished  hy  the  secre- 
tary of  state,  may  he  used  as  a  substitute  for  the  fore- 
going, as  showing  more  complete  compliance  with  the 
statutes  hy  the  trustees  in  the  performance  of  their 
duties  in  winding  up  the  affairs  of  the  corporation.] 


Appendix  183 

FORM  XXIV. 
Certificate  of  Dissolution. 

We,  the  undersigned,  a  majority  of  the  directors  of 

The     , 

a  corporation  organized  under  the  statute  laws  of 
the  State  of  Connecticut  and  located  in  the  town  of 

,  in  said  state,  acting  herein  as 

trustees  to  close  up  the  business  of  said  corporation 
under  the  provisions  of  said  statute  laws,  hereby 
certify : 

First.  That  we  have  completed  our  duties  in  wind- 
ing up  the  affairs  of  said  corporation. 

Second.  That  we  prepared  an  inventory  of  its 
assets,  collected  the  bills  and  accounts  receivable,  and 
made  a  list  of  its  creditors. 

Third.  That  within  two  weeks  from  the  date  of  the 
(vote)  (written  agreement)  to  dissolve  said  corpo- 
ration, we  sent  a  written  notice  of  such  proposed  dis- 
solution to  every  known  creditor  of  said  corporation, 

warning  him  to  present  his  claim,  and  on  the 

day  of ,  19 ,  published  a  copy  of 

said  notice  and  warning  in  the , 

a  newspaper  published  in  this  state  and  having  a 

circulation  in  the  town  of   ,  in 

which  town  said  corporation  is  located. 

Fourth.    On  the day  of ,19 , 

to  wit,  within  one  year  from  the  date  of  said  stock- 
holders' (agreement)  (vote)  to  dissolve  the  corpo- 
ration, all  of  its  collectible  assets  were  collected,  and 
all  of  its  property  and  uncollected  accounts  not  in  liti- 
gation, except  money,  that  could  not  be  advanta- 
geously sold  at  private  sale,  were  disposed  of  at  public 
auction,  and  as  soon  as  practicable  thereafter  all 
claims  allowed  by  said  trustees  against  said  corpora- 
tion were  paid  (in  full  and  the  balance  of  assets, 
namely  per  centum  of  all  outstand- 
ing capital  stock,  were  distributed  among  the  stock- 


184  Appendix 

holders  of  said  corporation)  or  {pro  rata  among  the 

creditors  of  said  corporation  at  the  rate  of 

per  centum  of  each  claim,  except  preferred  claims 
which  were  paid  in  full)  as  appears  in  the  following 
schedule  of  distribution : 


A  majority  of  the  Directors  acting  as  Trustees. 

State  of  Connecticut,     \gg  .  19 

County  of \ 

Personally  appeared 

a  majority  of  the 


directors  acting  as  trustees  of  The 
and  made  oath  to  the  truth  of  the  foregoing  certifi- 
cate, by  them  signed,  before  me, 


Justice  of  the  Peace. 
Notary  Public. 


FOEM  XXV. 

Certificate  of  Acceptance  of  Amendment  to  Charter. 

This  is  to  certify,  that  at  a  meeting  of  The* 

of ,  legally  warned  and  held 

for  the  purpose  on  the day  of , 

19 .... ,  the  resolution  amending  the  charter  of  said 


Stockholders,  incorporators,  members. 


Appendix  185 

corporation,  passed  at  the  January  session  of  the  gen- 
eral assembly,  19 ,  was  accepted  by  at 

vote  of  the* present,  of  which  vote 

the  following  is  a  copy : 


Dated  at ,  this day  of 

,19.... 


President. 

• , 

Secretary. 

FORM  XXVI. 

Articles  of  Association  for  Corporations  Without  Capital 
Stock. 

Be  it  known,  That  we,  the  subscribers,  do  hereby 
associate  ourselves  as  a  body  politic  and  corporate, 
pursuant  to  the  statute  laws  of  the  State  of  Connec- 
ticut regulating  the  formation  and  organization  of 
corporations  without  capital  stock,  and  the  following 
are  our  articles  of  incorporation : 

Article  1.     The  name  of  said  corporation  shall  be 

The    

Incorporated 

Article  2.  The  purposes  for  which  said  corpora- 
tion is  formed  are  the  following,  to  wit ; 


t  Unanimous,  two-thirds,  majority. 

*  Stockholders,  incorporators,  members. 


186  Appendix 

Article  3.     The  said  corporation  is  located  in  the 

town  of ,  county  of 

,  and  State  of  Connecticut. 

Dated  at ,  this day  of 

19.... 


Names  of  Subscribers. 

State  of  Connecticut,     |^^  .  ^^ 

County  of j 

Then  and  there  personally  appeared , 

signers  of  the  foregoing  instrument,  and  acknowl- 
edged the  same  to  be  their  free  act  and  deed,  before 
me. 


Justice  of  the  Peace. 
Notary  Public. 


FOREIGN  CORPORATIONS. 

FOEM  XXVII. 

Officers*  Statement. 

Statement  by  the 

In  accordance  with  the  provisions  of  an  act  of  the 
General  Assembly  of  the  State  of  Connecticut,  entitled 
*'An  Act  concerning  corporations,"  being  Chapter 

194  of  the  Public  Acts  of  1903,  The , 

a  corporation  organized  under  the  laws  of  the  State 

of ,  does  hereby  certify  and  set 

forth : 

First.  That  the  paper  hereto  attached  is  a  true  and 
correct  copy  of  its  charter  or  certificate  of  organiza- 


Appendix  187 

tion  filed  with  the  secretary  of  state  of  the  State  of 

and  properly  certified  by  the 

said  secretary. 

Second.    The  total  amount  of  capital  stock  said  com- 
pany is  authorized  to  issue  is  dollars, 

and  the  amount  actually  paid  in  is 

dollars,  of  which  amount dollars  has  been 

paid  in  in  cash,  and dollars  has  been  paid  as 

follows : 


Third.     The  character  of  the  business  which  said 
corporation  is  to  transact  in  this  state  is 

Dated  at ,  this day  of 

19.... 


President. 


•    •  5 

Treasurer. 


A  majority  of  the  Directors. 

S-'^^f   ■; '     Iss.:   19.... 

County  of ] 

Personally   appeared    , 

President, 

Treasurer,  and , 

a  majority  of  the  directors  of  The , 

and  made  oath  to  the  truth  of  the  foregoing  state- 
ment, by  them  signed,  before  me, 


Notary  Public. 


188  Appendix 

FORM  XXVIII. 

Certificate  of  Appointment  of  Secretary  of  the  State  as 
Attorney. 

Know  All  Men  by  these  Presents, 

That  ,  a  corporation  duly 

organized  under  the  laws  of  the  State  of , 

and  located  and  doing  business  at , 

acting  herein  by  its ,  duly  author- 
ized thereunto,  by  these  presents  makes,  ordains,  con- 
stitutes, and  appoints  the  secretary  of  the  state  of 
Connecticut,  and  his  successor  in  office,  its  true  and 
lawful  attorney  upon  whom  all  lawful  process  in  any 
action  or  proceeding  against  the  said  corporation,  in 
the  State  of  Connecticut,  including  the  process  of 
foreign  attachment,  may  be  served. 

And  said  corporation  hereby  agrees  that  any  lawful 
process  against  it  which  is  served  on  said  attorney, 
shall  be  of  the  same  legal  force  and  validity  as  if 
served  on  the  corporation,  and  that  said  appointment 
shall  continue  in  force  as  long  as  any  liability  remains 
outstanding  against  it  in  this  state. 

In  Witness  Whereof,  The  said  corporation  has 
caused  its  corporate  name  and  seal  to  be  hereto  affixed 

by* its* , 

thereunto  duly  authorized  this day 

of ,19.... 


State  of  Connecticut,     )  ^  .  ^g 

County  of 3 

Personally  appeared* of  said 

corporation,  signer  and  sealer  of  the  above  instrument, 
he  being  thereunto  duly  authorized  by  the  corporation 
above  named,  and  acknowledged  the  same  to  be  his 

*  Insert  name  and  title  of  office. 


Appendix  189 

free  act  and  deed,  and  the  free  act  and  deed  of  said 
corporation,  before  me, 


Notary  Public. 

FORM  XXIX. 

Annual  Report. 

We, President,  and 

Treasurer,  of  The , 

a  corporation  organized  under  and  pursuant  to  the 
laws  of  the  State  of ,  relating  to  cor- 
porations, and  having  its  principal  place  of  business 

in  Connecticut  in  the  town  of   ,  in 

compliance  with  the  requirements  of  the  laws  of  the 
State  of  Connecticut,  hereby  certify  as  of  the  first  day 
of  (January — July),  19. . . . 

First.  That  the  name,  residence,  and  post  office 
address  of  each  of  its  officers  and  directors  were  as 
follows : 

Name.  Residence.  P.   O.  Address. 

President,  

Vice-President,  

Treasurer,  

Assistant  Treasurer,  

Secretary,  

Assistant  Secretary,  


Directors, 


Second.    That  the  amount  of  its  outstanding  capital 

stock  which  had  not  been  paid  for  in  full  was 

dollars,  and  the  amount  due  thereon  was 

dollars. 

Third.  The  location  of  its  principal  office  in  Con- 
necticut was  No Street, 


190  Appendix 


Dated  at ,  this day  of 

19.... 


President. 
Treasurer. 


State  of  . . 
Comity  of 


'     Us.: 19... 


Personally  appeared, , 

President,  and ,  Treasurer, 

of  The ,  and  made  oath 

to  the  truth  of  the  foregoing  certificate,   by  them 
signed,  before  me, 


Notary  Public. 


FORM  XXX. 
Statement  of  the 


a  corporation  organized  under  the  laws  of  the  State 

of ,  and  operating 

mines,  oil  wells. 


1.  Amount  of  authorized  capital  stock. 

2.  Amount  of  capital  stock  issued. 

3.  Amount  of  capital  stock  held  by  corporation. 

4.  Amount  of  capital  stock  issued  in  payment  of 
property. 

5.  Amount  of  capital  stock  sold  for  cash. 

6.  Amount  of  cash  received  in  payment  for  stock. 


Appendix  191 

7.  Value  and  description  of  property  received  in 
payment  for  stock. 

8.  Amount  of  debts  or  liabilities  in 

a.     Bonds,  stating  rate  of  interest,  and  time  at 

which  bonds  fall  due. 
h.     Other  indebtedness. 

9.  Amount  of  cash  on  hand. 

10.  Amount    of    credits    and    estimated    value 
thereof : 

a.    Notes. 

6.     Bills  receivable. 

c.     Accounts  receivable. 

11.  Present  value  of  property  of  corporation. 

12.  Number  and  amount  of  dividends  declared. 

13.  Rate  of  last  dividend,  and  date  when  same  was 
declared  and  paid. 

II. 

1.  Location  of  properties  owned   (to  be  accom- 
panied by  plans  of  the  same). 

2.  Amount  of  work  done  on  the  property,  show- 
ing extent  of  development. 

3.  Amount  of  cash  expended  for  improvements 
on  said  properties. 

4.  Description  of  plant  and  machinery,  and  their 
present  condition. 

Dated  at ,  this day  of 

19.... 


President. 

•  •> 
Treasurer. 

•  •  t 
Secretary. 


192                            Appendix 
State  of  


Comity  of  ^ 

Personally  appeared , 

President, Treasurer,  and 

,  Secretary,  of  the 

and  made  solemn  oath  to  the  truth  of 

the  foregoing  statement,  by  them  signed,  before  me, 


Notary  Public. 


Fees  and  Taxes  to  be  Paid. 
To  THE  Treasurer  of  the  State. 

The  tax  on  the  total  authorized  capital  stock, 
whether  original  or  increased  stock,  is  as  follows : 

On  each  $1,000  up  to  $5,000,000 50  cents 

On  each  $1,000,  exceeding  $5,000,000 10  cents 

But  no  payment  less  than   $25.00 

There  is  no  tax  on  the  capital  stock  of  foreign  cor- 
porations. 

Corporations  without  capital  stock,  on  filing  the  cer- 
tificate of  incorporation,  pay  to  the  state  treasurer 
$10.00. 

For  Foreign  Corporations. 

On  filing  copy  of  charter  or  certificate  of 

organization     $10.00 

On  filing  statement  required  by  §  4811 . . .  5.00 

On  filing  other  certificates,  same  fees  as  for 
domestic  corporations. 

Note. — Section  4809  provides  that  one  ''page"  shall 
be  280  words. 


INDEX 


INDEX. 

PAGE 

Accommodation  paper,  acceptance  unauthorized 17 

drafts,  corporation  cannot  accept 17 

Action,  limitation  of  against  stockholder  for  unpaid  assess- 
ments       40 

removal  of,  from  state  courts 6 

Additional    provisions,    certificate    of    incorporation    may 

contain    108 

Additional  stock,  issue  of,  how  authorized 115 

special  meeting  for 115 

certificate  of  issue  of 115 

form   of    166 

Admission  of  corporate  capacity,  pleading 14 

Advertisement,  service  of  process  by 7 

Agent,  appointment  of 14 

directors  are  of  corporation 21,  25 

fraud  of,  estops  corporation,  when 139 

in  procuring  subscription 37,  39,  41 

knowledge  of,  affects   corporation 139 

to  execute  deed,  appointment  of 14 

under  corporate  seal 14 

Agreement  of  contractor  to  take  stock  as  pay  for  work, 

not  a  subscription 114 

Agreement   to    dissolve 67 

form  of 179 

Agreement  to   transfer   prevented  by  attachment 45 

Alteration  and  repeal  of  charter 88 

Alteration  and  repeal  of  by-laws,  how  made 47 

Alteration  of  charter, 

fundamental  must  be  assented  to  by  stockholders,  ...  49 
Amendment  of  certificate  of  incorporation  before  commenc- 
ing business 116 

Amendment  of  certificate  of  incorporation 117 

Amendments  to  charter 98 

not  binding,  when 98 

not    operative   until 98 


196  Index 

Amendments  to  charter  (continued).  page 

do  not  relieve  from  liability  when 38 

form  of  acceptance  of 184 

Annual  meeting,  when  and  where  held 47 

failure    to    hold 50 

stockholders  may  call,  when 50 

Annual   reports 74 

by  whom  made 74,  128 

corporation  need  not  file,  when 76 

failure  to  file  prima  facie  evidence  of  forfeiture,  when  77 

foreign  corporation  to  make,  except  when 128 

form   of 172 

must  show  what 75 

penalty  for  failure  to  file 76,  129 

how  collected 76 

president  and  treasurer  to  make 75 

of  building  and  loan  commissioner  concerning  invest- 
ment companies 81 

of   directors   to   stockholders 26 

remission  of  forfeiture  for  failure  to  file 78 

secretary  may  sign,   when 76 

to  general  assembly  to  be  made,  when 98 

Annual  returns  by  express  companies 79 

contain   what 79 

penalty  for  failure  to  file 80 

to  be  filed,  when  and  where 79 

Appeal  from  judgment  dissolving  corporation  to  be  taken, 

when    65 

Application  of  Corporation  Act  of  1901  and  1903 1,  100 

no  effect  on  special  charter,  except  when 1 

for  receiver;   orders  of  judge 53 

Appraisal  and  purchase  of  minority  stock  interest 65 

of  stock  of  aggrieved  stockholder 65,  66 

Articles  of   Association;    form   of 185 

Assets,  distribution  of  forbidden,  except 18 

see  Property. 

Assignment,  general,  passes  equitable  title  to  stock 47 

of  stock  duly  executed  and  registered  as  transfer. ...  46 

Attaching  creditor,  beneficial  owner  of  stock  against. ...  47 

books  final  for,  when 47 


Index  197 

Attaching  creditor  (continued).  page 

entitled  to  costs  on  appointment  of  receiver,  when.  ...  57 
see  Creditor. 

Attachment,  of  corporate  rights  or  shares 12 

how    made 12 

dissolved  by  appointment  of  receiver 56 

in    another    state    not    dissolved    by    appointment    of 

receiver   64 

stock  not  transferred  is  open  to 12,  47 

Attorney   for   foreign   corporation 125 

general,  duty  as  to  delinquent  foreign  corporation. .  . .  127 

Authority  of   agent 14 

of  receiver 54 

B. 

Banking,  penalty 102 

private    restricted 102 

report  to  bank  commissioners 103 

Bankruptcy,   appointment  of  receiver  may  be  act  of ...  .  64 

does  not  prevent  dissolution  by  state  court 64 

powers  of  trustee  in,  to  call  in  instalments 37 

Bond,  on  issue  of  new  certificate  discretionary  with  direct- 
ors      43 

Books  determine  who  are  stockholders 42 

final  for  attaching  creditor 47 

not  sole  evidence  of  corporate  acts 140 

right  of  stockholder  to  inspect 42 

receiver 's  right  to 54 

transfer  as  collateral  security  to  show 45 

Building  and  loan  commissioner,  annual  report  by,  concern- 
ing  investment    companies 83 

supervision  of  investment  companies 81 

Business,  certificate  of  incorporation  must  state 107 

change  of  nature  of,  vote  for 117 

certificate    of 117 

form   of 161 

kinds    of,    prohibited 106 

run  at  a  loss  not  per  se  ground  for  receiver 64 

surrender   of   rights   before  beginning 116 

voluntary   dissolution   after   beginning 67 


198  Index 

Business  (continued).  page 

when    to    commence 112 

By-laws  adopted  at  first  meeting 110 

alteration,  amendment,  and  repeal,  provisions  de 

26,  47,  111 

directors  cannot  repeal  restrictive 112 

directors  may  make  and  repeal,  except  when 112 

must  be  reasonable Ill 

nature    of 5 

form   of    151,  152,  153 

C. 

Call  for  first  meeting;  waiver 109,  110 

Calls  for  meetings  to   contain  what 47 

for    special    meeting    49 

by  whom  may  be  made 49 

on  failure  to  hold  annual  meeting 50 

stock   subscription 34 

Cancellation  of  stock  subscription,  when  not  allowable. ...     35 

Capacity  of  corporation,  when  admitted,  pleading 14 

Capital,  dividends,  when  impaired 18 

impairment   of    18,  22 

new  stock  and  stock  rights  as 94 

Capital  stock,  classes  authorized 100 

amount  of,  certificate  of  incorporation  to  state 107 

not  less  than  $2,000 107 

amount  of  with  which  business  begun,  not  less  than 

$1,000    108 

fraud  in  procuring  subscription  to 37,  39,  41 

increase,   stockholders   may 92,  117 

instalments,  directors  to  call 34 

creditor  may  call 36,  37,  38,  41 

par  value  of  shares  not  less  than  $25 107 

property    accepted    in    payment    for 33 

purchase  by  corporation  of  its  own,  how  made 31 

to   be  reported,   when 32 

stockholders '  obligations  as  to 36  to  41 

tax  on   99,  104,  105 

increase     99,  104,  105 

amount  of 192 


Index  199 

Capital  stock  (continued).  page 

trust  fund  for  creditors,  how  far  regarded  as 22 

see  Additional  Stock;   Increase;   Instalments;   Eeduc- 
tion;   Preferred  Stock. 

Certificates,  approval  of,  by  secretary  of  state 104 

certified   copies,   how  attested 104 

as  evidence,  prima  facie,  of  existence 109 

filed  with  secretary  of  state 104 

town  clerk 104 

for  fractional  shares  or  rights  prohibited 41 

for  forfeiture 78 

reinstatement,  how  obtained 78 

revocation  of,  when  by  secretary  of  state 78 

forms  of,  see  Appendix 143 

recorded,  where 104 

secretary  of  state  to  furnish  forms  for 90 

signed  and  sworn  to,  by  whom 104 

Certificate  of  change  of  location 117 

directors  to  make 117 

to   state   what 117 

to  be  approved 104 

form  of 162 

change  of  name 117 

to  be  approved 104 

form  of 160 

change  of  nature  of  business 117 

to  be  approved 104 

form   of 161 

consolidation  and  merger 119 

to  be  approved 104 

form  of 173 

dissolution    71,  72 

to  be  approved 104 

form  of    181,  183 

incorporation,  to  show  what 107,  108 

to  be  sworn  to. . .  .' 104 

approved     104 

certified  copy  to  be  filed  with  town  clerk 104 

form  of 144 

definition  of  purpose - 108 


200  Index 

Certificate  of  incorporation  (continued).  page 

may  contain  additional  provisions 108 

statements  in  as  estoppel  of  signers 108 

void   when    110 

Certificate  of  increase  of  capital  stock 93,  127 

to  be  approved 104 

form  of 164 

issue  of  additional  stock 115 

to   state   what 115 

to  be  approved 104 

form  of 166 

organization,  when  made 112 

to   state   what 113 

to  be  approved 104 

void  unless  filed  when 110 

form  of 155 

publication  of  reduction   of  stock 23 

to  show  what 23,  117 

to  be  approved 104 

form  of  170 

purchase  of  own  stock 32 

to  state  what 32 

form  of 171 

reduction  of  capital  stock 23,  96,  117,  127 

to   be   approved 96,  104 

form   of    168 

stockholders '  agreement  to  dissolve 71,  72 

to  be  approved 104 

form  of   179 

vote  to  dissolve 71,  72 

to  be  approved 72,  104 

form  of  180 

surrender  of  rights 116 

to  be  approved 104,  116 

form  of 178 

Certificate  of  stock  not  issued  till  full  paid 32,  35 

issue  of,  on  reduction  of  capital 23,  24 

lost,  new  certificate 43 

Certificate  when  corporate  existence  ends  by  limitation.  ...  73 
Changes  in  certificate  of  incorporation 117 


Index  201 

Changes  in  certificate  of  incorporation  (continued).  page 

certificate  of,  to  be  filed 117 

not  valid  unless  approved  how 117 

what  changes  may  be  made 117 

Changes  in  by-laws 47,  48 

Change  of  name 117 

form  of  certificate  of 160 

by  superior  court  of  specially  chartered  corporation ...     97 

location     117 

form  of  certificate  of 162 

nature  of  business 117 

form  of  certificate  of 161 

Charter,  amendments  to 88,  98 

not  binding  unless 98 

articles  of  association  stand  in  place  of 4 

binding  on  stockholders  when 49 

conditions,  courts  determine  compliance  with 113 

contract    relations    under 89 

extent  of   powers  under 15 

provisions  of,  presumptions  de  knowledge 36 

repeal  of 88 

revoked   as  license,  when 89 

void,   when 97 

without  organization  void  after  two  years 97 

Citizen,  corporation  ' '  citizen  ^ '  of  state  of  incorporation ...       3 
not  a  ' '  citizen ' '  within  Art.  IV,  Sec.  2,  CI.  1  of  U.  S. 
Constitution    3 

Claims,  action  to  enforce  to  commence  when 70 

against  corporation  as  payment  for  property  and  fran- 
chises          65 

application  to  court  for  order  limiting  presentation. .     69 

barred  when 70 

barred  unless  presented  within  time  limited 53 

disallowed,  are  barred  unless 70 

limitation  for  presentation  of,  on  winding  up 69,  70 

notice  of  presentation  of  to  contain  what 68,  69 

notice  of  rejection  of 70 

on  winding  up  to  be  presented 69,  70 

Section  33  not  to  prevent  establishment  of 71 

time  limited  for  presentation  of 53 


202  Index 

Claims  (continued).  .       page 

to  be  paid  as  soon  as  practicable 69 

when  barred  of  corporation  without  capital  stock....   133 
see  Creditor. 

Clerk,  temporary,  chosen  at  first  meeting 110 

Collateral  security: 

transfer  of  stock  as,  to  be  entered  in  books 44,  45 

Collection  of  taxes  on  shares 84 

Committees,  directors  may  appoint 25,  26 

Commencement  of  business 112 

see  Business. 
Compromise,  power  of  corporation  de  stockholder's  liability     37 
valid  defense  against  corporation  and  creditors  when. .     37 

Consolidation,  certificate  of  prima  facie  evidence 119 

debts  of  merging  corporations  attach  to  new  corpora- 
tion       120 

exemption  from  franchise  tax  on 120 

right  to  enforce  agreement  to  pay  debts  after 120 

Consolidation  and  merger  of  similar  corporations 117,  118 

directors '  agreement  for 118 

stockholders  to  vote  on 118 

rights  of  merged  corporations  after 119 

creditors,  after   120 

existence   of   separate  corporations  continues 120 

remedy  of  aggrieved  stockholder 121 

certificate  of,  how  made  and  filed 119 

form  of 173 

Contract,  charter  is  a 89 

rights  flowing  from  charter  as 89 

Contracts  beyond  corporate  power 15,  16,  17 

of  directors  with  corporation,  voidable 29 

prior  to  organization 114 

Corporate  capacity,  pleading 139 

existence,  duration  of 4,  5 

begins   when    109 

evidence  of    109 

joint  stock  company 138 

continued  for  certain  purposes 74 

decree  of  court,  effect  of 74 

ending  by  limitation 73 


Index  203 

Corporate  capacity  (continued).  page 

name,  character  of  1 

Corporation,  by-laws  to  be  consistent  with  law 5,  111 

de  facto 114,  115 

may  hold  and  convey  real  estate 4,  115 

definition    of 3,  4 

de    jure 3,  4 

dissolution,  power  de 5 

duration  of 4,  5 

existence  begins  before  it  can  begin  business  when. .  .    114 

implied  powers  of 5 

lien   of,  on  stock 44 

may  be  stockholder  in  other  except  when 26 

may  call  special  or  annual  meetings,  when 49,  50 

may  not  acquire  and  hold  its  own  stock  except  when.  .31,  32 

form  for  purchase  of  own  stock 171 

may  not  vote  upon  its  own  stock 31 

need  not  file  annual  reports,  when 76 

powers  of  court  to  revive  after  existence  ended 74 

property  of,  location  for  purposes  of  taxation 3,  86 

similar  may  consolidate 117 

principal  place  of  business 3 

Act  of  1901,  application  of 100 

powers  under 100 

certificates,  copies  as  'prima  facie  evidence 138 

as  garnishee    8,  9,  10,  11 

may  be  stockholder   31 

holding  stock,  may  be  represented  by  director 26 

Corporations  without  capital  stock: 

assessments,  how  authorized 136 

limitation  on   136 

vote  required  for 136 

by-laws  authorized   136 

certificate   of   incorporation 130 

amendment  of     131 

approval  required  130 

filing  and  record  of 130 

signed,  how   130 

terms    of    130 

corporate  existence,  how  proved 131 


204  Index 

Corporations  without  capital  stock  (continued).  page 

creditors  of  not  to  interfere  with  control 134 

dissolution   of 132 

fines,  may  impose  136 

membership,  succession   131 

organization,  how  effected 130 

powers  conferred  by  Section  3,  to  have 131 

property,  powers  concerning 131 

receivership  of   134,  135 

Creditor,  agreement  of  stockholders  against,  invalid 37 

action  by,  to  enforce  claim 70,  134 

books,  final  for,  when 46,  47 

claims  of,  barred  when 70,  134 

directors  liable  to,  when 18,  19 

inconsistent  rights  of,  to  renounce 63 

information  as  to  stockholder 80 

instalments  may  be  called  by 36,  37 

limitation  of  time  for  claims  of 53,  68,  69,  70 

may  apply  for  receiver  when 71,  134 

may  compel  payment  of  instalment 37 

may  sue  subscribers  when 36 

must  reduce  claims  to  judgment 36 

notice  to,  of  rejection  of  claim 70,  134 

not  to  interfere  with  control  of  property 71,  134 

ownership   of   stock   against 46,  47 

release  of  stockholder 's  liability  invalid  as  against . .     39 

D. 

Damages,  for  misrepresentations  inducing  purchase  of  stock     41 

Debtor,  to  corporation,  stock  may  be  sold  how 45 

Be  jure,  de  facto  corporation 3,  4,  114,  115 

liabilities  of    114,  115 

de  facto  may  hold  real  estate 115 

Decree,  binds  stockholders   74 

Deed,  agent 's  authority  to  execute 14,  15 

corporate  seal  to  be  attached 14 

Definition   of   purpose 108 

Directors,  acceptance  of  accommodation  paper  by 17 

accountable  for  conduct 28,  29 

acts  of  majority  binding 25,  27 


Index  205 

Directors  (continued).  page 

quorum   authorized 25 

agents  of  corporation 21,  25 

agreements  of,  when  not  binding 29 

for   consolidation    118 

annual  reports  of,  to  stockholders   26 

appoint  officers,  president,  secretary,  treasurer 115 

committees,  also  executive   26 

bond  on  issue  of  new  stock  certificates  discretionary 

with 43 

by-laws,  cannot  repeal  restrictive 112 

by  representation   26 

certificate  by,  of  change  of  name 117 

purpose   117 

location     117 

increase  of  stock 93,  127 

issue  of  additional  stock 115 

reduction  of  stock 96,  117 

publication  of  reduction 23 

creation  of  preferred  stock 95,  96 

issue  of  preferred  stock 117 

certificate  concerning  dissolution  to  file 71,  73 

contracts  with  corporation  voidable 29 

corporation  holding  stock  may  have 26 

diligence  and  care  required  of 30 

duties  and  obligations  of 28,  29 

breach  of   28,  29,  30 

dividend,  cannot  withhold,  when  declared 21,  27 

discretion   as  to   declaring 27 

elected  at  first  meeting 110 

annually    25 

eligibility    25 

estopped  after  signing  certificate 114 

good  faith  required  of 30 

knowledge  of,  when  binding. 139 

liable  for  mismanagement 29 

voting  dividend,  when 18,  19,  30 

liability  is  to  corporation 29,  30 

based  on  what 29,  30 

loans  to,  restricted 24 


206  Index 

Directors  (continued).  page 

majority  constitute  quorum 25 

manage  property  and  affairs 25 

may  appoint  committees 26 

may  call  in  subscriptions 34 

may  make  and  repeal  by-laws  except  when 26,  27 

meetings,  by  agreement 28,  112 

notice  of  regular  not  necessary 112 

notice  of  special  is  necessary 112 

notice  of  special  to  contain  what 112 

presumption  of  notice 28 

record  of  first,  form  of 151 

mortgage  of  property  by 28 

names,  voting  for  dividend  recorded 18 

notice  officially  to,  binding 28 

number  required  by  law 25 

president,  chosen  from  among 115 

property  valuation  to  be  signed  by 32,  33 

form   of    158 

fraud  in   33 

liability  for   33 

judgment  of,  final   33 

quorum,  majority  is 25 

remuneration,  not  entitled  to 30 

stockholder   eligible   as 25 

of  another  corporation  may  be 26 

suits  against    29 

may  sue  director  for  mismanagement  when 29 

trustees     28,  29 

to  wind  up  business 68 

duties    of    as 68,  69,  70 

must  be  stockholders 25 

elected  annually    25 

hold  office  how  long 25 

vacancies  in  board,  may  fill 25 

votes  for  distribution  of  assets 18,  19 

votes  of,  presumed  legal 27,  28 

Disclosure,  examination  of  officer 138 

by  corporation  as  garnishee 9 

Dissolution,  application  for,  to  superior  court 69 


Index  207 

Dissolution  (continued).  page 

approval  of  certificate  of,  terminates  existence 72 

bankruptcy  does  not  prevent  decree  of 64 

certificate  of  agreement  for 71,  72 

form  of 179 

vote  for 67 

form  of  180 

final    72 

form  of    181,  183 

confirmation  of  stockholders 67 

consent  to,  dispenses  with  votes 67,  68 

decree  of,  affects  what  franchise 64 

directors,  trustees  to  wind  up 68 

by  forfeiture,  judgment  of 5 

not  had  collaterally 5 

limitation  of  time  for  creditors 68,  69,  70 

meeting  for 67 

notice  of 67 

disuse  of  powers  not 5 

neglect  of  franchises  not 5 

but  may  be  ground  for 5 

of  foreign  corporation  only  by  state  which  created  it. .   129 

resignation  of  officers  not 5 

votes  for 67 

voluntary    67 

Dissolution  of  corporations  without  capital  stock 132 

agreement  of  all  members  dispenses  with  votes 133 

application  to  superior  court 134 

board  of  management  trustees  to  wind  up  business.  . .  .   133 

call  for  special  meeting 132 

certificates  concerning  dissolution  135 

corporate  existence  to  be  continued  for  certain  pur- 
poses       136 

creditors  not  to  interfere  with  control  of  property.  ...   134 

duties  of  trustees 133 

receiver  may  be  appointed  when 134,  135 

vote  of  members  de 132,  133 

when  claims  barred 134 

Dissolution  of  old  corporations,  provisions  de 72,  73 

Dividends  and  distribution  of  assets 18,  19 


208  Index 

Dividends  (continued).  PAGE 

cash  belongs  to  life  tenant 20,  21 

declared,  cannot  be  withheld 21 

difference  between  stock  and  cash 20,  21 

payable  in  stock  of  another  corporation  ^'cash  divi- 
dend ' '  when 22 

penalty  for  unlawful  declaration  of 19 

record  of  directors  voting  for 18,  19 

refunded,  if  impairing  capital 19,  21,  22 

rendering  corporation  insolvent,  liability  of  directors.  .      19 

restricted    18 

stock,  belongs  to  trust  fund 19,  93,  94 

stock,  ownership  of  as  between  life-tenant  and  remain- 
der-man     19,  20 

see  Stock  Dividend. 

Drafts,  acceptance  of  accommodation,  illegal 17 

Duty  of  secretary  of  state  when  served  with  process 126 

fee  to  be  paid 126 

record  of  all  process  to  keep 126 

E. 

Election   of   officers 115 

omission  of,  at  annual  meeting 50 

directors     110 

Electricity,  manufacture  for  sale  restricted 17 

Eminent  domain,  company  requiring  right  of,  not  author- 
ized to  do  business  by  Corporation  Act 105,  106 

Employes,  profits  may  be  shared  with 24 

Equity  of  redemption,  lien  on,  how  enforced 44,  45 

Estate,  right  of,  to  subscribe  to  new  stock 19 

may  sell  rights  in  increased  stock ) . . . .     94 

real,   powers    concerning 4 

agent    to    convey 14,  15 

seal  requisite  on  conveyance 14,  15 

Estoppel  of  corporation,  agents,  directors 114 

of  incorporators    108 

of  promoter  when 38,  39 

Evidence,  agents '  declarations 139,  140 

burden  on  stockholder,  when 114 

certified  copies  of  certificates  are 138 


Index  209 

Evidence  (continued).  page 

confessions   of   stockholders   not ]39 

corporate   existence    109 

directors,  terms  of  certificate  estop 114 

disclosure  by  officer  of  corporation 138 

inadmissible  to  bind,  when 139 

inference  de  treasurer's  continuation  in  office 140 

intention  may  be  proved  by  parol 140 

knowledge  of  director  affects  corporation 139 

president  of  corporation  may  testify  as  to  intention. .  140 

records  of  public  offices  and  corporations 138 

stock-books  are,  of  title  to  stock 42 

as,  in  all  courts 42 

right  to  vote 42 

use  of  pronoun  "we"  or  "I"  as  affecting  contract. .  140 

votes,  legality  of,  presumed 27 

Execution,  levy  of,  on  stock 13 

as  discharge  of  garnishee 12 

of  deeds,  under  corporate  seal 14 

Executive  committee,  powers  of  directors  may  be  delegated 

to     26 

Exemption,  from  franchise  tax  on  consolidation 120 

Express  company,  annual  returns  of,  to  contain  what ....  79 

penalty  for  failure  to  file 79 

to  be  filed  when  and  where 79 

F. 

Failure  to  file  annual  report 76 

prima  facie  evidence  of  forfeiture  when 77 

remission  of  forfeiture  for 78 

Failure  to  hold  meeting  and  elect  officers 50 

not  to  impair  corporate  rights  when 50 

Fees  for  filing  certificates 137 

First  meeting,  adjournments  of 110 

by-laws  to  be  adopted  at 110 

called,   how    109 

directors  to  be  elected  at 110 

notice    of,    published 109 

form   of    149 

organization  to  be  perfected  at 110 


210  Index 

First  meeting  (continued).  page 

temporary  clerk  chosen 110 

records  by  150,  151 

waiver  of  notice  of 109 

form   of 150 

Foreign  attachment  (see  Garnishee  Process) 8,  9 

affidavit  of  treasurer  or  paymaster 9 

citing  garnishee  to  disclose 9 

disclosure  to  officer 9 

levy  of  execution  on  corporate  stock 13 

liability  for  non-appearance  of  garnishee 10 

of  corporate  rights  or  shares 12 

service  of  process 8,  9 

on  disbursing  agent  or  paymaster 11 

on  bank  or  trust  company 12 

Foreign  corporation,  defined 122 

acceptance  of  conditions  by 124 

annual  report,  form  of 189 

attorney,  appointment  of 1 25 

evidence   of    126 

secretary  of  state  to  be 123,  125 

service  on   126 

attorney,  neglect  to  appoint,  penalty 127 

attorney-general,  duty  of,  as  to  delinquent 127,  ]28 

business,  kinds  of,  prohibited,  to 122 

statement  prior  to  doing,  to  contain  what 125 

what  constitutes  doing 124 

can  only  be  dissolved  by  state  which  created  it 129 

charter,  copy  of,  to  be  filed  where 125 

penalty  for  failure  to  file 127 

conditions,  state  may  impose 124 

legality  of    124 

executor  or  trustee,  may  act  as,  in  this  state 123 

increase  of  stock  by 127 

certificate  of,  to  be  filed 127 

license  fee    192 

exaction  of,  legal 124 

not  a  ' '  citizen ' '  under  XlVth  Amendment 124 

officers '   statement,   form   of 1 86 

power  of  state  over 124 


Index  211 

Foreign  corporation  (continued).  page 

powers  and  limitations  of 122 

real  estate,  may  hold 122 

reduction  of  stock 127 

certificate  of,  to  be  filed 127 

service  of  process  on,  how  made 126 

duty  of  secretary  of  state 126 

fee  paid  on 126 

notice  to  corporation 126 

record  of,  kept  by  secretary  of  state 126 

statement  before  doing  business 125 

suits  by  and  against,  jurisdiction 6 

what  penalties  apply  to 129 

Forfeiture,  dissolution  by,  judgment  for 5 

failure  to  file  annual  report  as  prima  facie  evidence 

of     77 

not  available  collaterally 5 

not  to  affect  certain  societies  and  associations 78 

remission   of 78 

Formation  of  corporation 105 

number  of  persons  requisite 105 

prohibited,  kinds  of  business 106 

telephone  exchange  business  may  organize  under  Cor- 
poration Act 106 

Forms  for  certificates,  secretary  of  state  to  furnish 90 

of  certificates  and  records.     See  Appendix. 

of  transfer  prescribed  in  by-laws 44 

Fractional  shares,  certificates  for,  prohibited 41 

how    disposed    of 41 

Franchise,  lease  of,  unauthorized  when 69 

neglect  to  use,  effect  of 5 

sale  of,  by  receiver 65 

surrender  of 116 

tax  on  and  exemption  when 99,  104,  120 

Fraud,  agreement  to  release  stockholder,  as 37,  39 

of   agent,   effect   of 139 

of  directors  for  over-valuation  of  property 32 

of  promoters,  effect  of 115 

incorporators    115 


212  Index 

Fraud  (continued).  page 

effect  of,  on  subscriber  to  stock 39 

purchaser    of    stock 39 

subscription  obtained  by,  may  be  cancelled 39 

Fraudulent  resignation  of  officers,  will  not  dissolve  corpora- 
tion      5 

G. 

Garnishee  process,  affidavit  of  non-indebtedness 9 

demand  on  execution 13 

disclosure    9 

examination    of    officer 10 

liability  for  non-appearance 10 

service,  how   made 8,  9 

scire  facias 10 

on  bank  or  trust  company 12 

General  Assembly,  annual  reports  to,  by  corporations 98 

power  to  amend  and  repeal 98 

acceptance  of  amendment  as  giving 98 

powers  of  corporations 4 

limitations    on    4,  15 

I. 

Impairment  of  capital,  dividend  causing 18 

Incorporation,  business  prohibited 105,  106 

certificate  of,  amendments  to 116,  117 

approval    of,    requisite 104 

form  of 147 

Incorporators,  authority  of  to  receive  subscriptions 109 

to   reject   subscriptions 34 

to  manage  affairs 109 

estoppel  by  statements  in  certificate  when 108 

false   representations  to 138 

fraud  of 138 

fiduciary   relations    of 137 

powers  of,  begin  when 109 

end  when 109 

secret   profits    of,    illegal 138 

surrender    of   rights   by 116 


Index  213 

PAGE 

Increase  of  capital  stock,  how  made 92 

of  specially  chartered  corporations 92 

rights  resulting  from  to  be  sold  when 41 

certificate  of  vote  to 93 

form  of 164 

special  meeting  to  vote  on 92 

see  Additional  Stock. 

Increased  capital  stock  instalments,  how  called 34 

creditor  may  call 36,  37 

rights  of  estate  in 94 

rights  of  stockholder  in 93,  94 

Indebtedness  of  stockholder,  how  collected 45 

Indorsement    passes    property 14 

Information  for  creditor  of  stockholder 80 

penalty  for  refusing 80 

Injunction  by  stockholders  against  directors    29 

Insolvency,  directors  causing,  by  dividend,  liable 19 

existence    not    terminated    by 5 

powers  of  trustee  to  call  in  instalments 36 

Instalments,    directors '    discretion   in   calling 34 

form  of  vote  to  call 158 

receiver  may  call  m 36 

sale  of  stock  if  not  paid 45 

subject  to  call  when 36 

to  be  returned  if  subscription  not  made  in  good  faith  34 

trustees  may  call  in 36 

see  Increased  Capital  Stock. 

Intention  ascertained  from  parol  evidence 140 

Investment  companies,  bond  issue,  vote  to  limit 80 

certified  copy  of  vote  to  be  filed 80 

guaranty    of    debenture    bonds 81 

supervision  of  by  building  and  loan  commissioner.  ...  81 

to  be  licensed  by  building  and  loan  commissioner ....  83 

vote  duly  filed  as  perpetual  limitation 80 

Issue  of  additional  stock 115 

certificate  of,  to  show  what 115 

form   of    166 

directors  may  make • 115 

special  stockholders '  meeting  for 115 


214  Index 

PAGE 

Insurance  company  business  of,  not  authorized  by  Corpora- 
tion Act 106 

J. 

Joint-stock  company: 

application  of  Act  of  1901  and  1903  to 1,  100 

evidence  of  existence  and  capacity 138 

Judgment,  appeal  from,  when  to  be  taken 65 

dissolving  corporation  final  as  to  whom 65 

Jurisdiction  of  Federal  courts,  how  determined 6 

removal  from  state  courts 6 

L, 

Laws,  liability  of  stockholder  under,  of  other  states 40 

Lease  of  franchise  unauthorized 69 

when   corporation   cannot   take 16 

Legal  title,  to  stock  unchanged  until  actual  transfer 39 

Levy  of  execution  on  stock 13 

as  discharge  of  garnishee 12 

Liability,   of  Directors 18 

for  improper  declaration  of  dividends 19 

for  conversion  of  funds 29,  30 

for  mismanagement 29,  30 

for  assenting  to  purchase  of  stock  rendering  cor- 
poration insolvent 31 

for  causing  insolvency  by  reducing  stock 31 

for  fraudulent  over -valuation  of  property 32 

for  negligence  in  making  loan 30 

to    creditors 19 

to  refund  dividends  improperly  declared 19 

of  Stockholder 

ceases  when 36 

corporation's  power  to  compromise 37 

depends  upon  laws  of  state  of  incorporation 40 

equal  whether  original  subscriber  or  not 37 

for  improper  receipt  of  assets 19 

for  unpaid   stock 36 

not  relieved  from  by  amendment  to  charter  when,  37 


Index  215 

Liability  of  stockholder  (continued).                                        page 
on  shares  irregularly  issued  and  receipt  of  divi- 
dends  thereon 39 

release  of,  invalid  as  fraud  on  creditors 39 

remains  unchanged  until  actual  transfer 39 

to  refund  dividends  improperly  declared 19 

to  creditor  of  telephone,  telegraph,  electric  light 

or  power  company,  when 38 

to  creditor  of  corporation  when 38,  39 

under  laws  of  other  states 40 

of  officers  for  fraudulent  misrepresentations 41 

License   to    investment   companies  to   do   business   in   this 

state    83 

Lien  of  corporation  on  stock 44 

how   enforced 44 

on  pledged  stock  not  avoided  when 44 

Section  33  not  to  prevent  foreclosure  of  when 71 

Limitation,  corporate  existence  ending  by 73 

statutes   of,   in   action   against   stockholders   begin   to 

run   when 40 

of  dividends 19 

of  time  for  presenting  claims 68,  69,  70 

on  powers  of  trust  companies 101 

List,  of  stockholders  open  to  inspection  at  meeting 42 

Loans  to  officers  and  directors  restricted 24 

Location : 

change  "  of,  how  made 117 

certificates  required  for 117 

form  of 162 

limitation  on  power  to  change 92 

meeting  for  purpose  of 117 

for  purposes  of  Federal  jurisdiction 3 

how  determined 3 

in  some  town  of  this  state 2 

of  corporate  property  for  purposes  of  taxation 86 

to  be  stated  in  certificate 107 

Loss,  that  business  run  at,  not  per  se  ground  for  receiver. .  64 

Lost   stock   certificate 43 

bond  required  on  issue  of  new  when 43 

new  may  be  issued  to  replace 43 


216  Index 

Lost  stock  certificate  (continued).  page 

superior  court  may  order  delivery  of  new  when 43 

M. 

Machinery,  mortgage  on  after-acquired  valid 101 

Majority  of  directors  to  sign  certificates 

71,  73,  113,  115,  117,  118 

valuation  of  property  by 33 

constitute  a  quorum 25 

of  quorum  may  bind  corporation 27 

Majority  of  stockholders  present  a  quorum  unless  other- 
wise   provided 48 

right  of  to  rule,  when  implied 49 

vote  of,  usual  manner  of  giving  direction 49 

Mandamus   to   enforce   calling   of   meeting 91 

proper   remedy,    when 90 

Manufacture  of  electricity  restricted 17 

Margin,  statements  on,  part  of  stock  certificate 35 

Meetings : 

annual,  when  and  where  called 47 

failure    to    hold 50 

failure   to   elect   ofl&cers   at 50 

by-laws    provide    for 47 

calls  for,  how  made 47 

first,  call  for  and  waiver  of  notice  of 109 

for  adoption  of  by-laws 47 

for  change  of  by-laws 47 

mandamus  to  enforce  calling 91 

method  of  calling  to  be  followed 47 

notice  of,  should  state  what 47 

how  given 47 

to  be  issued  by  proper  authority 48 

presumed  to  be  received  when 48 

pledgors  of  stock  may  vote  at 51 

president  or  secretary  to  call 47 

president  or  stockholders  to  call  special 49 

procedure  on  failure  to  hold,  unless  otherwise  provided     50 

proxies  legal  at 51 

limited   except   when 51 

quorum,  what  constitutes 52 


Index  217 

Meetings  (continued).  page 

special,  how  called 49 

to  vote  on  consolidation 118 

stockholders  may  call  special  when 49 

trustees   may   vote   at 51 

vote  at,  each  share  entitled  to  one 51 

waiver   of  statutory  notice   of 49 

see  First  Meeting;  Directors'  Meeting. 

Merger.     See  Consolidation. 

Mining  and  oil  corporation,  statement  of 190 

Minority,  appraisal  of  interest  and  purchase  of 65 

majority   cannot   bind   when 89 

Misrepresentations,  liability  of  officers  for,  inducing  to  buy 

stock    41 

Mortgage,  on  after-acquired  machinery  valid 101 

Section  33  not  to  prevent  foreclosure  of,  when 71 

N. 

Name,  certificate  of  incorporation  to  state 107 

commences    with    word    * '  The " 1 

corporate  character  required 1 

change  of,  how  made 97,  117 

certificate  of,  required 97,  117 

form  of 160 

meeting  for  purpose  of 117 

rights  not  affected  by 97 

superior  court  may  make 97 

ends  with  word  "Company,''  "Corporation"  or  "In- 
corporated "     1 

fictitious  trade  names,  business  under 2 

foreign  name  may  be  used  in  signing  a  contract 2 

injunction   against  improper  use   of 2 

must    distinguish   from   other   corporations 1 

not  to  indicate  that  corporation  is  a  bank,  etc.,  except 

when    2,  102 

of  stockholders,  books  to  contain 42 

protected  in  use  of 2 

Name  and  location  of  corporations 1 

National  bank  not  exempt  from  state  laws,  when 103 

Neglect,  to  pay  instalments 44 


218  Index 

Neglect  (continued).  page 

of  use  of  franchise,  effect  of 5 

of  duties  by  officers,  penalty 90 

of  secretary  to  make  list  of  stockholders 42 

Negligence  of  directors  in  making  loan 30 

Negotiable  instruments,  indorsement  by  corporation  passes 

title  to 14 

New  certificates,  issue  of,  on  reduction  of  capital 23 

when  old  certificate  lost 43 

Nonresident,  stock  of  subject  to  attachment 14 

Notice,  as  affecting  pledge 44 

of  first  meeting,  how  given 109 

to   be   published 109 

form  of  149 

waiver  of  notice  of 109 

form   of 150 

of  meetings ;  by-laws  provide  method  for 47 

to  majority  in  certain  cases  sufficient 28 

president  or  secretary  to  give 47 

special,  how  given 49 

stockholders  may  give,  when 49 

of  call  of  instalments,  how  given 34 

of  sale  of  stock  to  satisfy  instalment 45 

to  enforce  lien  for  debts 45 

presumption  of,  from  records 28,  48 

receipt  of   48 

to  agent  binds  corporation 139 

to  creditors  on  winding  up 68 

to  director  acting  officially,  binding 139 

to  president  binds  corporation 139 

Number  of  shares  owned,  stock  books  to  show 42 

O. 

Officers,  authority  for  election  and  appointment 4 

appointment    of    115 

duration  of  office  unless  otherwise  provided 50 

examination  of,  in  suit 138 

loans   to,    restricted 24 

liability  for  fraudulent  misrepresentation 41 

on  failure  to  elect  hold  over 50 


Index  219 

Officers  (continued).  page 

penalty  for  issuing  certificate  before  tax  paid 99 

president  and  treasurer  may  be  same  person 115 

president  elected  from  and  by  directors 115 

resignation  ineffectual  if  fraudulent 5 

removal  of   112 

secretary  and  treasurer  may  be  same  person 115 

treasurer  and  secretary  appointed 115 

treasurer  and  secretary  need  not  be  directors 115 

Offset  of  claim  invalid  when 38 

Oil  and  mining  corporation,  statement  of 190 

Omission  of  annual  meeting,  effect  of 50 

report,  liability  for   76,  77,  78 

Option  of  stockholders  to  take  increased  stock 93 

of  estate  to  take  increased  stock 94 

Organization,  certificate  of 112 

approval  of 104,  113 

to  be  filed  within  two  years 110 

certified  copy  of,  evidence 113 

directors   to   make 113 

form   of    155 

irregularities  of,  no  defense  to  promoter 38 

to   state   what 113 

uncompleted,   subscribers    are   unincorporated   persons 

associated  in  business 114 

as  creating  a  corporation  de  facto 115 

effected  at  first  meeting 110 

effect  of  defects  in 114 

burden  of  proof  of  defects  in,  on  stockholder 114 

Organize,  failure  to  in  two  years  renders  charter  void. ...  97 

meaning  of  word Ill 

Other  states,  liability  of  stockholders  under  laws  of 40 

P. 

Par  value  of  shares  not  less  than  $25 107 

Parol,  condition  to  subscription  invalid 39 

see  Evidence. 

Partnership,  formed  by  defective  organization 114 

liability  of  shareholder  as  a  partner 114 

property  of,  power  of  court  over 55 


220  Index 

Partnership  (continued).  page 

property,  receiver  entitled  to  control  of 56 

receiver  of,  when  and  how  appointed 55 

Penalty,  action  for  does  not  survive  death  of  officer 90 

foreign  corporation  for  failure  to  file  annual  report.  .  . 

128,  129 

for  failure  to  file  certificates  and  appoint  attorney. . . .  127 

for  improper  declaration  of  dividends 18 

for  refusal  to  permit  inspection  of  list  of  stockholders,  42 

for  violation  of  Act  of  1903 90 

Person,    corporation    a    ' '  person ' '    in    Sec.    1    of    XlVth 

Amendment,  U.   S.   Constitution 3 

Place  of  business.     See  Location. 

Pleading,  corporate  capacity  admitted  unless  denied 14 

Pledge  of  stock,  effected  by  delivery  of  certificate 43 

as  against  others  than  pledgor  by  actual  transfer  only,  43 

lien  of  corporation 44 

of  stock  without  transfer  does  not  avoid  corporation's 

lien     44 

treasurer 's  receipts    43 

Pledgors  of  stock  may  vote,  when 51 

Powers  of  attorney,  copy  of  to  be  filed  with  corporation  43,  44 
required  in  order  to  pledge  stock 43,  44 

Powers  of  corporations 4 

as  to  compromise  of  amount  due  from  stockholder. ...  37 

contracts  in  excess  of 16,  17 

extent   of    15 

implied  of   corporation 5 

limitations  on  trust  companies 101 

not  applicable  when 101 

motive  of  exercise  may  affect  validity 16 

not  to  be  exceeded 16,  17 

restriction  of    105,  106 

to  limit  operations  of  foreign  corporations 122 

to  transact  business  outside  of  state 18 

Powers  of  corporation  without  capital  stock 131 

of  court  to  revive  corporation  after  existence  ended.  .  74 

Power  of  incorporators.     See  Incorporators. 

Preferred  stock  authorized  how 95 

as  to  assets 94 


Index  221 

Preferred  stock  (continued),  page 

as    to    dividends 94 

certificates  for,  not  issued*  until  when 95 

certificate  of  issue  shows  what 95 

filed  with  secretary  of  state 95 

form   of    165 

dividends  may  be  cumulative 94 

President,  chosen  by  directors 115 

director,  must  be   115 

may  call  special  meeting 49 

of  railroad   company  may   testify  as  to   intention   of 

corporation  without  vote 140 

on  refusal  to  call  special  meeting  stockholders  may. .  49 

shall  call  special  meeting  when 49 

signs  annual  report   74 

penalty  for  failure  to  file 76 

Presumption  of  knowledge  of  stockholders 36 

legality  of  meetings 48 

votes    27 

receipt  of  notice 48 

Private  banking  restricted  102 

Process,  how  served  on  corporation 6 

in  garnishee  process   8,  11 

on  foreign  corporation 125 

service  by  advertisement  or  order 7 

on  nonresident  in  quo  ivarranto 8 

Profits  may  be  shared  with  employes 24 

Promoter,     See  Incorporator    115,  137 

definition   of    137 

estopped  to  set  up  irregularities  in  organization  when,  38 

false  representations  made  to,  effect  of 138 

fiduciary  relation  of,  toward  corporation 137 

irregularities  of  organization  no  defense  to 38 

liable  for  fraud  on   corporation 115,  138 

must  exercise  good  faith  towards  stockholders 138 

secret  profits  may  be  recovered  from,  when 115 

services  of,  valid  consideration  for  corporation  note.  .  138 

Property,  accepted  in  payment  for  stock 33 

creditors  not  to  interfere  with  control  of 71,  134 


222  Index 

Property  (continued).  page 

directors'  judgment  as  to  value  of  final 33 

liability    for   over -valuation 33 

sign  statement  of  value 33 

form  of  statement 158 

directors'  fraud  in  valuation  of 33 

indorsement  of  corporation  passes 14 

mortgage  of,  by  directors,  valid 28 

powers  de  real  and  personal  of  corporation 4 

sale  of,  by  receiver 65 

to  pay  debts    15 

to  wind  up   16 

unauthorized,  passes  no  title 16 

sale  of  by  trustees  on  winding  up 68,  69,  133 

time  for  sale  of,  may  be  extended  by  court ....  68,  69,  134 

title  of  trustee  of  insolvent  debtor  to 44,  70 

trust  fund  for  creditors,  when  regarded  as 22 

Provisions  of  charter,  stockholder  presumed  to  know 36 

Proxies  for  voting  authorized 51 

duration  of    51 

Publication  of  notice  of  first  meeting 109 

reduction  of  capital  stock 23 

stockholders '  meeting  for  dissolution 67 

to  creditors  on  winding  up 68 

Purchase,  by  corporation,  of  own  stock 31 

restrictions  upon 31 

Purchaser,  may  reorganize  corporation 65 

may  set  up  fraud  as  defense  when 39 

may  sue  officer  for  fraudulent  misrepresentations ....  41 
of  corporation  property  and  franchises,  rights  of .  .  .  .  65 
of  originally  issued  shares  virtually  an  original  sub- 
scriber     37 

Purpose  of  corporation,  what  kinds  forbidden 105,  106 

certificate  to  specify   107 

change  of,  how  made 117 

special  meeting  for   117 

certificate  required  117 

form   of    161 

drafted  carefully    108 


Index  223 

Q*  PAGE 

Quorum,  of  directors,  what  constitutes 27 

of  stockholders,  what  constitutes 48 

Quo  warranto,  service  on  nonresident  in  case  of 8 

E. 

Eailroad  company  shares,  condemnation  of,  authorized. . . .   103 
statute  authorizing  condemnation  is  constitutional. . .   103 

Eatification  dates  back  to  execution  of  contract 114 

of  promoter 's  contract   114 

Eeceipts  for  payment  of  subscription 32 

issued  by  treasurer  and  secretary 32 

subsequent  payments  entered  on 33 

surrender  for  certificate  of  stock 35 

to  state  amount  paid 33 

number  of  shares  full  paid 33 

under  corporate  seal   33 

Eeceiver,  appeal  from  order  of  court  when 63 

application  for  appointment  of,  when  may  be  made.  .  .     52 

appointment  by  court   53 

commencement    of    proceedings    dissolves    attach- 
ment when    56 

entitles  to  costs  when 57 

may  constitute  an  act  of  bankruptcy  when 64 

does  not  dissolve  corporation 64 

authority  of  54 

business  run  at  loss  not  necessarily  ground  for  appoint- 
ment  of 64 

certificate  of   dissolution   by 53 

corporate  existence  continues  under 64,  74 

corporation   without   capital   stock 134 

court  may  appoint  on  application  of  creditor  when,  71,  134 

court  may  remove  at  pleasure  and  fill  vacancy 56 

duties  of,  on  dissolution  of  corporation 53 

duties  of  in  general  as  to  inventory 59 

entitled  to  control  of  partnership  property 56 

general  manager  not  appointed  as,  when 63 

grounds  of   appointment   of 52,  134 

inconsistent  rights  of  creditors 63 

instalments  may  be  called  in  by 54,  39 


224  Index 

Eeceiver  (continued).  page 

may    accept    claims    against    corporation    in    payment 

when    65 

may  not  appeal  from  order  of  removal 63 

may  recover  dividends  when 21,  22 

may  sell  property  and  franchises  when 65 

may  sell  rights  to  collect  unpaid  subscriptions 37 

of  corporations  having  property  upon  which  members 

depend  for  support 62 

of  partnership  when  and  how  appointed 55 

orders  of  judge  of  superior  court  as  to 53 

powers    of    54 

powers  of  court  over  partnership  property 56 

removal  of,  notice  of  petition  for 63 

right  to  books  and  property 54 

sale  of  property  and  franchise  by 65 

temporary  appointed,  how  and  when 57,  58 

to  file   semiannual  statements 55 

to  give  bond  with  surety 54 

vote  of  town  necessary  before  application  entertained 

when    63 

wages  paid  by,  court  may  determine 64 

are  preferred  claims    56 

Eecords  to  show  valuation  of  property 33 

Recording   certificates    104 

fees   for    137 

Reduction  of  capital  stock,  how  made 23,  96,  117 

certificate  required   23,  96,  117 

form  of 168 

publication  of    23 

form  of   170 

of  specially  chartered  corporation  how  made 96 

of    corporation    organized    under    general    laws,    how 

made    117 

rights  resulting  from  to  be  sold  when 41 

record  of  stockholders  voting  for 23 

stockholders '  liability  on 23 

stock  certificates  after    23 

Release,  of  stockholder's  liability  invalid  when 39 

Remedy  of  aggrieved  stockholder  by  consolidation 121 


Index  225 

Eemedy  (continued).  ^  page 

award  becomes  debt 121 

entitled  to  receive  payment  for  stock 121 

must  object  in  writing  to  consolidation 121 

transfer  of  stock  on  payment  of  award 121 

value  of  stock  how  ascertained 121 

Removal  of  officers 112 

of  place  of  business,  restriction  on.     (See  Location)  . .     92 

Eemuneration,  directors  not  entitled  to 30 

Repeal   of    charter 88 

fundamental  changes  operating  as 89 

not  effective,  when  89 

of  by-laws,   how  made 47 

power  of,  cannot  be  exercised  unless  reserved 89 

Rescission,  stockholder  must  act  promptly  to  obtain 39 

Residence  of  directors,  certificates  to  state 113 

Resignation,  ineffectual  if  fraudulent,  to  dissolve  corpora- 
tion           5 

vacancies  caused  by 112 

Return  to  tax  commissioner,  inspection  of  limited 87 

Rights,  as  capital 94 

from  increase  or  reduction  of  stock  to  be  sold  when. .     41 

surrender   of   before  beginning  business 116 

to  subscribe  to  new  stock,  who  entitled  to 19 

S. 

Sale  of  property  and  franchises 65 

claims  against  corporation  as  payment  on 65 

court  may  order  when 65 

entitles  purchaser  to  what 65 

time  for  may  be  extended  by  court 70 

see  Property. 

Sale  of  stock,  surplus  belongs  to  stockholder 45 

to  enforce  lien,  how  made 44 

Savings  bank,  business  of  not  authorized  by  Corporation 

Act     105 

Seal  and  its  equivalent 15 

authorized 4 

deed  of  corporation  must  be  under 14 

not  affixed  to  vote  appointing  agent 14 


226  Index    ' 

PAGE 

Secretary,  and  treasurer  may  be  same  person 115 

annual  report  may  sign  when 76 

appointment  of 115 

attachment  of  shares  served  on 12 

certificate  to  attaching  officer 12 

as  to  consolidation  119 

certificates  signed  by 35 

duration  of  office  50 

instructions  to,  see  Appendix  generally. 

levy  of  execution  left  with 13 

may  refuse  to  permit  transfer  of  stock  when 46 

notice  of  meetings  given  by 47 

penalty  for  refusing  information 42 

for  neglect  or  refusal  to  produce  list 42 

for  refusing  to  permit  inspection 42 

service  of  process  on 6,  7 

garnishee  process  on   8 

stock  receipts  countersigned  by 32 

to  prepare  list  of  stockholders 42 

to  produce  and  permit  inspection  of  list 42 

to  record  directors'  valuation  of  property 33 

names  of  directors  voting  for  dividend 18 

stockholders '  names  reducing  stock 23 

Secretary  of  state  attorney  for  foreign  corporations 125 

certificates  approved  by   104 

recorded  by  137 

copies  of,  furnished  by 137 

forms  of,  furnished  by 90 

fees  on  filing  certificates 137 

form  of  certificate  of  appointment 188 

Section  24  not  to  revive  certain  corporations 50 

Service  of  process    6 

by  advertisement    7 

in  case  of  foreign  attachment 11 

in  case  of  attachment  of  stock 12 

levy  of  execution  on  corporate  stock 13 

on  bank  or  trust  company  as  garnishee 12 

on   corporation    6 

on  disbursing  agent  or  paymaster 11 


Index  227 

Service  of  process  (continued).  page 

on  nonresident  in  quo  warranto 8 

on  secretary  of  state  as  attorney  for  foreign  corpora- 
tion    125,  126 

Set-off  invalid,  when  38 

Shares  of  stock,  agreement  to  transfer  passes  no  title  when,  45 

appraisal  of  minority  interest 65 

assignment,  general  gives  equitable  title 47 

attachment  of,  how  made 12 

beneficial   owner   entitled   to 47 

books  show  who  owners  are 42 

each  entitled  to  one  vote 51 

issue  of  fractional,  forbidden 41 

legal  title  to,  imchanged  until  actual  transfer 39 

levy  of  execution  on 13 

lien  of  corporation  on  for  debts  due  it 44 

may  be  transferred  after  appointment  of  receiver ....  64 

notice  of  instalment  on 34 

to  enforce  lien   45 

par  value  of  not  less  than  $25 107 

personal  property 44 

pledged,  how   43 

proxies  on    51 

purchase  by  corporation  of  its  own,  restrictions  on 31 

sale  to  enforce  lien,  how  made 44 

stockholder  aggrieved  by  merger 121 

tax  on,  collection  of 84 

transfer  of,  on  books  only 44 

by  attorney   44 

entry  of   credit  insufficient 46 

for  collateral  to  so  state 45 

prevented  by  attachment 45 

refusal  to,  by  secretary  when  justified 46 

registry  passes  title  39 

perfects  title  39 

votes  on   51 

Special  charter,  increase  of  capital  stock  under 92 

location    of    corporation    organized   under    not   to    be 

changed     92 

Special  meetings,  on  failure  to  hold  annual  meeting 50 


228  Index 

Special  meetings  (continued).  page 

president  may  call   49 

shall  call,  of  corporation  having  capital  stock  when. .  49 

shall  call,  of  corporation  having  no  capital  stock  when,  49 

stockholders  may  call  when 49 

see  Meetings. 

State,  power  over  national  banks 103 

to  transact  business  outside  of 18 

Statement  of  foreign  corporation 125 

value  of  property  by  directors 33 

Stock.     See  Additional  Stock;  Preferred  Stock j  Shares. 

Stock,  additional  issue  of 115 

certificate  of  to  contain  what 115 

how  transferred    44 

lien  of  corporation  on 44 

ownership  of  in  other  corporations,  makes  director  or 

one  executive  officer  eligible 26 

personal  property  44 

Stock-books,  evidence  in  all  courts  of  this  state 42 

evidence  of  title  to  stock 42,  44 

open  to  examination  of  stockholder 42 

prima  facie  evidence  as  to  who  are  stockholders.  ...  42 

to  contain  what 42 

Stock  certificates,  certify  number  of  shares 35 

for  fractions  prohibited   41 

marginal  statements,  part  of 35 

not  issued  till  full  paid 32 

signed  by  whom   35 

Stock  dividend  belongs  to  trust  fund 19,  20,  94 

part  of  capital   19,  20,  94 

who   entitled  to    19,  20,  94 

Stockholders,  aggrieved  by  consolidation 121 

amendments  affecting  rights   '.  40 

application   for   appraisal   of   minority   stock   interest 

may  make 65 

attorney  of,  may  sign  waiver 49 

books  determine  who  are 42 

open  to  examination  of 42 

bound  by  charter  and  general  corporation  law 36 

burden  of  proof  on,  when 114 


Index  229 

Stockholders  (continued).  page 

cannot  set  up  irregularities  in  stock  issue  when 39 

complaint  to  superior  court  in  case  of  lost  certificate. .  43 

corporation  may  be,  except  when 31 

decree  of  court  binding  on 74 

directors  not  sued  by,  unless 29 

elected  by    110 

eligibility  as  director 25 

entitled  to  notice  of  sale  of  stock  by  corporation ....  45 

entitled  to  surplus  arising  from  sale 45 

examination  of  books  by,  when  and  where 42 

holders  of  treasurer 's  receipts  are 33 

increase   of   stock  by 92,  117 

information  to  creditor  of 80 

inspection  of  books  by 42 

instalments  due  from    34 

knowledge  of  what  assumed 36 

liability  ceases,   when 36 

equal  whether  subscriber  or  not 36,  37 

under  laws  of  other  states 40 

liable  for  unpaid  assessments  until  actual  transfer.  . .  39 

for  unpaid  stock    36 

list  of,  secretary  to  make  three  days  before  meeting. .  42 

open  to  inspection  of 42 

majority  may  direct  policy 48,  49 

may  avoid  contracts  with  directors  when 29 

may  call   annual  meeting  when 50 

may  call  special  meeting  when 49,  50 

may  meet  and  act  after  appointment  of  receiver 64 

may  vote  in  person  or  by  proxy 51 

must  act  promptly  to  rescind  subscription  obtained  by 

fraud   40 

notice  of  meeting  entitled  to 47 

by  whom  and  how  to  be  given 47 

what  to  contain 47 

obligations   assumed  by    36 

original    subscriber    or   purchaser   presumed   to    know 

what     36 

power  to  amend  by-laws  de  increase  of  directors Ill 

preferred  stock  may  vote  to  issue 95 


230  Index 

stockholders  (continued).  page 

vote  to   determine  what 95 

proxies  for  voting   51 

purchase  of  minority  interest  by 65 

quorum,  what  constitutes 48 

ratification  by,  of  contracts 29,  114 

reduction  of  stock,  by 23,  96,  117 

liability  for   23 

rights  and  liabilities  determined  by  law  of  state  of 

incorporation    40 

rights  of,  in  increased  stock 19,  20,  94 

to  dividends    19,  20 

right  to  inspect  annual  report 26 

right  to  mandamus,  when 90 

statutes  of  limitation  in  action  against  begin  when. .  40 

subscription  enforced  after  insolvency 36 

suits  against  directors 29 

votes,  one  for  each  share  unless  otherwise  provided. .  51 

on  changes  in  certificate  of  incorporation 117 

on  consolidation  and  merger 118 

on  dissolution    67 

waiver  of  notice  of  proposed  action  may  make 49 

see  Shares  of  Stock;  Stock  Dividend. 

Subscriber,  agreement  limiting  liability  invalid 39 

entitled  to  notice  of  call 34 

obligations  of    36 

purchaser  of  originally  issued  shares  virtually  a 37 

surrender  of  franchise  by 116 

unincorporated  persons,  when 114 

word  '  '■  subscriber ' '  includes  every  shareholder 34 

see  Stockholder. 

Subscription  to  stock,  agreement  to  release  invalid 39 

as  trustee  binds  individual 37 

cancellation  of,  when  not  allowable 35 

contractor's  agreement  to  take  stock  not  a 114 

directors  may  call  in 34 

effect  of  invalid,  on  other 35 

form  of 148 

fraud  affecting   39 

liability  on,  under  foreign  laws 40 


Index  231 

Subscription  to  stock  (continued).  PAGE 

may  be  cancelled  when  obtained  by  fraud 39 

notice  of  call  for  payment  of 34 

not  made  in  good  faith,  disallowed 34 

parol  condition  annexed  to,  inadmissible 39 

part  payment  entitles  to  treasurer 's  receipt 32 

Succession,  limited  or  perpetual  of  corporation 4 

Superior  court,  appraisal  to  be  filed  with  clerk  of 65 

appraisers  of  minority  stock  interest,  may  appoint 66 

discretion  of,  de  appointment,  etc 53,  66 

duties  of  clerk  of,  as  to  appraisal 66 

may  extend  time  for  sale  of  property 70 

may  limit  time  for  presentation  of  claims 69 

name  of  specially  chartered  corporation  may  change 

how    97 

powers  of  de  receivers,  etc 52,  53,  55,  56 

to  order  delivery  of  new  stock  certificate  when 43 

to  require  proper  bond  from  stockholder 43 

Suits  by  and  against  corporations 4 

against,   jurisdiction    6 

Summons,  service  of   6,  7 

see  Service  of  Process. 

Surplus,  stockholder  entitled  to,  after  sale  to  enforce  lien     44 

Surrender  of  rights  before  beginning  business 116 

form  of  certificate  of 178 

T. 

Tax,   amount   of    99,  104 

exemption  from  on  consolidation 119 

in  lieu  of  other  tax  on  franchise 105 

on  capital  stock 99,  104 

payments    192 

shares,  collection  of  84 

specially  chartered  corporation   99 

Taxation,  cash  of  foreign  corporation  in  hands  of  receivers 

taxable  here 85 

corporate  property  where  listed 87 

deductions  from  list 86 

list  to  contain  what 87 

location  of  corporate  property  for  purpose  of 87 


232  Index 

Taxation  (continued).  page 

New    Haven,   property   in    of   trading   business,   how 

assessed     86 

of  certain  corporations  84 

of    corporate    realty    and    stockholders'    shares,    not 

double    88 

of  property  when  stock  not  taxable 85 

penalty  for  issuance  of  certificate  before  payment  of,  99 

property  of  traders  listed  where 86 

returns  to  tax  commissioner 87 

inspection  of  limited 87 

stockholders  exempt  when 87 

Tax  commissioner,  returns  to,  inspection  of  limited 87 

Telephone  companies  may  organize  under  general  laws. .  . .  106 

Section  62  of  this  Act  pro  tanto  repealed 106 

Temporary  clerk  chosen  at  first  meeting 110 

instructions  to,  see  Appendix  generally. 

Title  to  stock,  agreement  to  transfer  does  not  pass 45 

creditor,  may  ascertain  from  books 46,  47 

entry  of  credit  on  treasurer's  book  insufficient  to  pass,  46 

equitable  may  pass  by  contract,  sale,  gift,  etc 46 

equitable,  of  trustee  by  general  assignment 47 

legal,  determined  by  corporation  books 46 

see  Shares  of  Stock. 

Town  clerk,  certified  copy  of  certificate  of  incorporation 

to  be  filed  with 104,  130 

Transfer,  actual,  necessary  to  make  pledge  of  stock 43 

agreement  to,  ineffectual  as  against  creditors 45 

as  against  creditors  must  be  actual 44 

assignment  of  stock  as 46 

effectual    when    46 

for  collateral  security  to  so  state 45 

how  made 44 

legal  title  remains  unchanged  until  actual 46 

of  shares  after  appointment  of  receiver 64 

secretary  may  refuse  to  permit  when 46  ' 

to  one  not  consenting  thereto  withheld 46 

Transfer  books,  open  to  examination  when  and  where ....  42 

original  or  duplicate  as  evidence  in  all  courts 42 

prima  facie  evidence  as  to  who  are  stockholders 42 


Index  233 

Transfer  books  (continued).  page 

to  contain  what 42 

Treasurer,  appointment  of  115 

president  and,  or  secretary  and,  may  be  same  person. .   115 

to  issue  receipts  for  stock  payments 32 

to  sign  annual  report 74 

penalty  for  failure 76 

Treasurer's  receipts,  actual  transfer  necessary  to  effectuate 

pledge  of,  when 43 

issue  of  new,  to  replace  lost  or  destroyed 43 

may  be  pledged  by  delivery 44 

Trust,  dividends  on  stock  held  in 19,  20 

Trust  companies,  limitation  on  powers  of 101 

business  of,  not  authorized  by  Corporation  Act 106 

Trustees,  directors  as,  to  wind  up  business 68,  69,  70,  133 

duties  of  directors  as 68,  69,  70,  133,  134 

in  insolvency  may  hold  stock  when  not  actually  trans- 
ferred         44 

may  apply  to  superior  court  to  limit  time  for  claims, 

69,  134 

may  call  instalment  36 

may  subscribe  to   increased  stock 94 

may  vote  stock,  when 51 

notice  of  rejection  of  claim  to  give 70,  134 

powers  cease  on  appointment  of  receiver 71,  135 

subscription  for  stock  as,  binds  individual 37 

title  to  property  of  insolvent  debtor 70 

to  act  under  direction  of  court 70,  134 

see  Eeceivers. 

U. 

Ultra  vires  contracts,  when  enforceable 17 

V. 

Vacancy  in  board  directors  may  fill 25 

Voluntary  dissolution  after  commencing  business,  call  for 

special  meeting 67 

claims  barred  unless 70 

directors '  duties  as  trustees 68,  69,  70 

directors '  vote  for 67 


234  Index 

Voluntary  dissolution  (continued).  page 

notice  of  special  meeting 67 

procedure  on   68,  69,  70 

stockholders '  vote  for  67 

votes  may  be  dispensed  with  by  written  agreement  of 

all  stockholders   67 

Votes  of  stockholders,  how  taken 51 

may  be  by  proxy 51 

one  for  each  share  unless  otherwise  provided.  ...  51 

directors,  presumed  legal 27 

forms  of,  see  Appendix. 

W. 

Wages,  court  may  determine  amount  when 64 

preferred  claim  for   56 

Waiver  of  notice  of  first  meeting 109 

special  meeting 49 

form  of    150 

jurisdiction     6 

of  statutory  notice  of  proposed  action,  how  made 49 

What  penalties  apply  to  foreign  corporations 129 

Winding  up  of  affairs.     See  Dissolution. 

Withdrawal  of  assets  restricted 18 

of  capital  18 

what  constitutes   22 


64GG33 


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UNIVERSITY  OF  CALIFORNIA  UBRARY 


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